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Includes depreciation expense of $(25), $(22), for the three months ended June 30, 2024 and June 30, 2023, respectively, and $(77) and $(65) for the nine months ended June 30, 2024 and June 30, 2023, respectively.
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
FORM 10-Q

(Mark One)
☒QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2024
OR
☐
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Commission File Number 001-32502

Warner Music Group Corp.
(Exact name of registrant as specified in its charter)

Delaware
(State or other jurisdiction of
incorporation or organization)
13-4271875
(I.R.S. Employer
Identification No.)
1633 Broadway
New York, NY 10019
(Address of principal executive offices)
(212) 275-2000
(Registrant’s telephone number, including area code)
___________________________________________________________________________________________
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Class A Common Stock, $0.001 par value per shareWMGThe Nasdaq Stock Market LLC
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ☒    No  ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes  ☒    No  ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer
☒
Accelerated filer☐
Non-accelerated filer☐Smaller reporting company☐
Emerging growth company☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act.)    Yes  ☐    No  ☒
As of August 1, 2024, there were 141,604,087 shares of Class A Common Stock and 376,314,780 shares of Class B Common Stock of the registrant outstanding.



WARNER MUSIC GROUP CORP.
QUARTERLY REPORT ON FORM 10-Q
FOR THE THREE AND NINE MONTHS ENDED JUNE 30, 2024
TABLE OF CONTENTS
Page
Number



PART I. FINANCIAL INFORMATION
ITEM 1.    FINANCIAL STATEMENTS
Warner Music Group Corp.
Condensed Consolidated Balance Sheets
(In millions, except share amounts which are reflected in thousands)
(Unaudited)
June 30,
2024		September 30,
2023
Assets
Current assets:
Cash and equivalents$607 $641 
Accounts receivable, net of allowances of $23 million and $19 million
1,222 1,120 
Inventories92 126 
Royalty advances expected to be recouped within one year450 413 
Prepaid and other current assets112 102 
Total current assets2,483 2,402 
Royalty advances expected to be recouped after one year837 688 
Property, plant and equipment, net of accumulated depreciation of $594 million and $523 million
464 458 
Operating lease right-of-use assets, net226 245 
Goodwill2,003 1,993 
Intangible assets subject to amortization, net2,309 2,353 
Intangible assets not subject to amortization150 149 
Deferred tax assets, net29 32 
Other assets329 225 
Total assets$8,830 $8,545 
Liabilities and Equity
Current liabilities:
Accounts payable$200 $300 
Accrued royalties2,582 2,219 
Accrued liabilities499 533 
Accrued interest29 18 
Operating lease liabilities, current43 41 
Deferred revenue168 371 
Other current liabilities52 57 
Total current liabilities3,573 3,539 
Long-term debt3,978 3,964 
Operating lease liabilities, noncurrent232 255 
Deferred tax liabilities, net251 216 
Other noncurrent liabilities161 141 
Total liabilities$8,195 $8,115 
Equity:
Class A common stock, $0.001 par value; 1,000,000 shares authorized, 141,603 and 138,345 shares issued and outstanding as of June 30, 2024 and September 30, 2023, respectively
$— $— 
Class B common stock, $0.001 par value; 1,000,000 shares authorized, 376,315 and 377,650 issued and outstanding as of June 30, 2024 and September 30, 2023, respectively
1 1 
Additional paid-in capital2,053 2,015 
Accumulated deficit(1,260)(1,387)
Accumulated other comprehensive loss, net(311)(322)
Total Warner Music Group Corp. equity483 307 
Noncontrolling interest152 123 
Total equity635 430 
Total liabilities and equity$8,830 $8,545 
See accompanying notes
1

Warner Music Group Corp.
Condensed Consolidated Statements of Operations
(In millions, except share amounts which are reflected in thousands, and per share data)
(Unaudited)
Three Months Ended
June 30,		Nine Months Ended
June 30,
2024202320242023
Revenue$1,554 $1,564 $4,796 $4,451 
Costs and expenses:
Cost of revenue(830)(850)(2,501)(2,332)
Selling, general and administrative expenses (a)(462)(461)(1,384)(1,353)
Restructuring and impairments
(1)— (96)(41)
Amortization expense(55)(64)(167)(188)
Total costs and expenses(1,348)(1,375)(4,148)(3,914)
Net gain on divestitures
1 — 32 41 
Operating income207 189 680 578 
Loss on extinguishment of debt— (4)— (4)
Interest expense, net(40)(38)(121)(105)
Other income (expense)4 20 (9)(72)
Income before income taxes171 167 550 397 
Income tax expense(30)(43)(120)(112)
Net income141 124 430 285 
Less: Income attributable to noncontrolling interest(2)(2)(36)(7)
Net income attributable to Warner Music Group Corp.$139 $122 $394 $278 
Net income per share attributable to common stockholders:
Class A – Basic and Diluted$0.27 $0.23 $0.75 $0.53 
Class B – Basic and Diluted$0.27 $0.23 $0.75 $0.53 
Weighted average common shares:
Class A – Basic and Diluted141,568138,290140,531137,990
Class B – Basic and Diluted376,315377,650376,868377,650
(a) Includes depreciation expense:$(25)$(22)$(77)$(65)
                                        
See accompanying notes
2

Warner Music Group Corp.
Condensed Consolidated Statements of Comprehensive Income
(In millions)
(Unaudited)
Three Months Ended
June 30,		Nine Months Ended
June 30,
2024202320242023
Net income$141 $124 $430 $285 
Other comprehensive (loss) income, net of tax:
Foreign currency adjustment(10)(13)13 78 
Deferred (loss) gain on derivative financial instruments— (3)(1)(8)
Minimum pension liability
— — (1)
Other comprehensive (loss) income, net of tax(10)(16)11 70 
Total comprehensive income131 108 441 355 
Less: Income attributable to noncontrolling interest(2)(2)(36)(7)
Comprehensive income attributable to Warner Music Group Corp.
$129 $106 $405 $348 
See accompanying notes
3

Warner Music Group Corp.
Condensed Consolidated Statements of Cash Flows
(In millions)
(Unaudited)
Nine Months Ended
June 30,
20242023
Cash flows from operating activities
Net income$430 $285 
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization244 253 
Unrealized (gains) losses and remeasurement of foreign-denominated loans and foreign currency forward exchange contracts10 71 
Deferred income taxes29 (18)
Loss on extinguishment of debt— 4 
Net loss (gain) on investments
(4)(3)
Net loss (gain) on divestitures
(32)(41)
Non-cash interest expense5 2 
Non-cash stock-based compensation expense28 42 
Non-cash impairments
50 — 
Changes in operating assets and liabilities:
Accounts receivable, net(95)(94)
Inventories34 — 
Royalty advances(183)(67)
Other noncurrent assets
(85)(10)
Accounts payable and accrued liabilities(119)(93)
Royalty payables352 250 
Accrued interest8 12 
Operating lease liabilities(4)(2)
Deferred revenue(205)(207)
Other balance sheet changes(13)(35)
Net cash provided by operating activities450 349 
Cash flows from investing activities
Acquisition of music publishing rights and music catalogs, net(123)(53)
Capital expenditures(83)(89)
Investments and acquisitions of businesses, net of cash received(26)(26)
Proceeds from the sale of investments12 22 
Proceeds from divestitures19 42 
Net cash used in investing activities(201)(104)
Cash flows from financing activities
Partial proceeds from Senior Term Loan Facility refinancing
42 146 
Partial repayment of Senior Term Loan Facility refinancing
(42)— 
Deferred financing costs paid(2)(3)
Distribution to noncontrolling interest holders(6)(11)
Dividends paid(267)(251)
Taxes paid related to net share settlement of restricted stock units and common stock
(5)— 
Proceeds from Term Loan Mortgage
— 19 
Payment of deferred and contingent consideration— (133)
Net cash used in financing activities(280)(233)
Effect of exchange rate changes on cash and equivalents(3)4 
Net (decrease) increase in cash and equivalents(34)16 
Cash and equivalents at beginning of period641 584 
Cash and equivalents at end of period$607 $600 
See accompanying notes
4

Warner Music Group Corp.
Condensed Consolidated Statements of Equity
(In millions, except share amounts which are reflected in thousands, and per share data)
(Unaudited)
Nine Months Ended June 30, 2024
Class A
Common Stock		Class B
Common Stock		Additional
Paid-in
Capital		Accumulated
Deficit		Accumulated
Other
Comprehensive
Loss		Total
Warner Music
Group Corp.
Equity		Non-controlling
Interest		Total
Equity
SharesValueSharesValue
Balance at September 30, 2023138,345 $— 377,650 $1 $2,015 $(1,387)$(322)$307 $123 $430 
Net income— — — — — 394 — 394 36 430 
Other comprehensive income, net of tax
— — — — — — 11 11 — 11 
Dividends ($0.51 per share)
— — — — — (267)— (267)— (267)
Stock-based compensation
— — — — 43 — — 43 — 43 
Distribution to noncontrolling interest holders— — — — — — — — (6)(6)
Acquisition of noncontrolling interests— — — — — — — — (1)(1)
Shares issued under the Plan1,738 — — — — — — — — — 
Exchange of Class B shares for Class A shares1,335 — (1,335)— — — — — — — 
Shares issued under Omnibus Incentive Plan185 — — — (5)— — (5)— (5)
Balance at June 30, 2024141,603 $— 376,315 $1 $2,053 $(1,260)$(311)$483 $152 $635 

Three Months Ended June 30, 2024
Class A
Common Stock		Class B
Common Stock		Additional
Paid-in
Capital		Accumulated
Deficit		Accumulated
Other
Comprehensive
Loss		Total
Warner Music
Group Corp.
Equity		Non-controlling
Interest		Total
Equity
SharesValueSharesValue
Balance at March 31, 2024141,596 $— 376,315 $1 $2,043 $(1,310)$(301)$433 $152 $585 
Net income— — — — — 139 — 139 2 141 
Other comprehensive income, net of tax
— — — — — — (10)(10)— (10)
Dividends ($0.17 per share)
— — — — — (89)— (89)— (89)
Stock-based compensation
— — — — 10 — — 10 — 10 
Distribution to noncontrolling interest holders— — — — — — — — (1)(1)
Acquisition of noncontrolling interests— — — — — — — — (1)(1)
Shares issued under Omnibus Incentive Plan7 — — — — — — — — — 
Balance at June 30, 2024141,603 $— 376,315 $1 $2,053 $(1,260)$(311)$483 $152 $635 
5

Nine Months Ended June 30, 2023
Class A
Common Stock		Class B
Common Stock		Additional
Paid-in
Capital		Accumulated
Deficit		Accumulated
Other
Comprehensive
Loss		Total
Warner Music
Group Corp.
Equity		Non-controlling
Interest		Total
Equity
SharesValueSharesValue
Balance at September 30, 2022137,199 $— 377,650 $1 $1,975 $(1,477)$(347)$152 $16 $168 
Net income— — — — — 278 — 278 7 285 
Other comprehensive income, net of tax— — — — — — 70 70 — 70 
Dividends ($0.48 per share)
— — — — — (251)— (251)— (251)
Stock-based compensation
— — — — 32 — — 32 — 32 
Distribution to noncontrolling interest holders— — — — — — — — (11)(11)
Shares issued under the Plan869 — — — — — — — — — 
Shares issued under Omnibus Incentive Plan273 — — — — — — — — — 
Balance at June 30, 2023138,341 $— 377,650 $1 $2,007 $(1,450)$(277)$281 $18 $299 

Three Months Ended June 30, 2023
Class A
Common Stock		Class B
Common Stock		Additional
Paid-in
Capital		Accumulated
Deficit		Accumulated
Other
Comprehensive
Loss		Total
Warner Music
Group Corp.
Equity		Non-controlling
Interest		Total
Equity
SharesValueSharesValue
Balance at March 31, 2023138,324 $— 377,650 $1 $2,000 $(1,488)$(261)$252 $14 $266 
Net income— — — — — 122 — 122 2 124 
Other comprehensive loss, net of tax— — — — — — (16)(16)— (16)
Dividends ($0.16 per share)
— — — — — (84)— (84)— (84)
Stock-based compensation
— — — — 7 — — 7 — 7 
Distribution to noncontrolling interest holders— — — — — — — — (4)(4)
Shares issued under Omnibus Incentive Plan17 — — — — — — — — — 
Balance at June 30, 2023
138,341 $— 377,650 $1 $2,007 $(1,450)$(277)$281 $18 $299 
See accompanying notes
6

Warner Music Group Corp.
Notes to Condensed Consolidated Financial Statements (Unaudited)
1. Description of Business
Warner Music Group Corp. (the “Company”) was formed on November 21, 2003. The Company is the direct parent of WMG Holdings Corp. (“Holdings”), which is the direct parent of WMG Acquisition Corp. (“Acquisition Corp.”). Acquisition Corp. is one of the world’s major music entertainment companies. We classify our business interests into two fundamental operations: Recorded Music and Music Publishing.
Recorded Music Operations
Our Recorded Music business primarily consists of the discovery and development of recording artists and the related marketing, promotion, distribution, sale and licensing of music created by such recording artists. We play an integral role in virtually all aspects of the recorded music value chain from discovering and developing talent to producing, distributing and selling music to marketing and promoting recording artists and their music.
Music Publishing Operations
While Recorded Music is focused on marketing, promoting, distributing and licensing a particular recording of a musical composition, Music Publishing is an intellectual property business focused on generating revenue from uses of the musical composition itself. In return for promoting, placing, marketing and administering the creative output of a songwriter, or engaging in those activities for other rightsholders, our Music Publishing business shares the revenues generated from use of the musical compositions with the songwriter or other rightsholders.
2. Summary of Significant Accounting Policies
Interim Financial Statements
The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with United States generally accepted accounting principles (“U.S. GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all the information and notes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three and nine months ended June 30, 2024 are not necessarily indicative of the results that may be expected for the fiscal year ending September 30, 2024.
The consolidated balance sheet at September 30, 2023 has been derived from the audited consolidated financial statements at that date but does not include all the information and notes required by U.S. GAAP for complete financial statements.
For further information, refer to the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended September 30, 2023 (File No. 001-32502).
Basis of Consolidation
The accompanying financial statements present the consolidated accounts of all entities in which the Company has a controlling voting interest and/or variable interest required to be consolidated in accordance with U.S. GAAP. All intercompany balances and transactions have been eliminated.
Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 810, Consolidation (“ASC 810”) requires the Company first evaluate its investments to determine if any investments qualify as a variable interest entity (“VIE”). A VIE is consolidated if the Company is deemed to be the primary beneficiary of the VIE, which is the party involved with the VIE that has both (i) the power to control the most significant activities of the VIE and (ii) either the obligation to absorb losses or the right to receive benefits that could potentially be significant to the VIE. If an entity is not deemed to be a VIE, the Company consolidates the entity if the Company has a controlling voting interest. As of June 30, 2024 and September 30, 2023, there were approximately $72 million and $5 million of assets and $2 million and $2 million of liabilities, respectively, related to VIEs included in our condensed consolidated balance sheets.
The Company has performed a review of all subsequent events through the date the financial statements were issued and has determined that no additional disclosures are necessary.
7

Income Taxes
The Company uses the estimated annual effective tax rate method in computing its interim tax provision. Certain items, including those deemed to be unusual and infrequent are excluded from the estimated annual effective tax rate. In such cases, the actual tax expense or benefit is reported in the same period as the related item. Certain tax effects are also not reflected in the estimated annual effective tax rate, primarily certain changes in the realizability of deferred tax assets and uncertain tax positions, and are recorded in the period in which the change occurs.

Global Intangible Low-Taxed Income (“GILTI”) imposes U.S. taxes on the excess of a deemed return on tangible assets of certain foreign subsidiaries. The Company made an election to recognize GILTI tax in the specific period in which it occurs.
New Accounting Pronouncements
Accounting Pronouncements Not Yet Adopted
In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. The amendment enhances reportable segment disclosure requirements, primarily by requiring enhanced disclosures about significant segment expenses, reporting for interim periods, and Chief Operating Decision Maker (“CODM”) related information. The amendments in this ASU are effective for fiscal years beginning after December 15, 2023 and interim periods within fiscal years beginning after December 15, 2024. The Company is in the process of evaluating the effect that the adoption of these standards will have on its consolidated financial statements.
In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. The amendment enhances income tax disclosure requirements, by requiring enhanced disclosures on the income tax rate reconciliation and income taxes paid. The amendments in this ASU are effective for fiscal years beginning after December 15, 2024. The Company is in the process of evaluating the effect that the adoption of these standards will have on its consolidated financial statements.
3. Earnings per Share
The Company utilizes the two-class method to report earnings per share. Basic earnings per share is computed by dividing net income available to each class of stock, less earnings available to participating securities, divided by the weighted average number of outstanding common shares for each class of stock. Diluted earnings per share is computed by dividing net income available to each class of stock, less earnings available to participating securities, divided by the weighted average number of outstanding common shares, plus dilutive potential common shares, which is calculated using the treasury-stock method. The potentially dilutive common shares did not have a dilutive effect on the Company’s EPS calculation for the three and nine months ended June 30, 2024 and 2023, respectively.
8

The following table sets forth the calculation of basic and diluted net income per common share under the two-class method for the three and nine months ended June 30, 2024 and 2023 (in millions, except share amounts, which are reflected in thousands, and per share data):
Three Months Ended June 30,
20242023
Class AClass BClass AClass B
Basic and Diluted EPS:
Numerator
Net income attributable to Warner Music Group Corp.$39 $100 $34 $88 
Less: Net income attributable to participating securities (a)
(2)— (2)— 
Net income attributable to common stockholders$37 $100 $32 $88 
Denominator
Weighted average shares outstanding141,568 376,315 138,290 377,650 
Basic and Diluted EPS$0.27 $0.27 $0.23 $0.23 
Nine Months Ended June 30,
20242023
Class AClass BClass AClass B
Basic and Diluted EPS:
Numerator
Net income attributable to Warner Music Group Corp.$111 $283 $77 $201 
Less: Net income attributable to participating securities (a)
(5)— (4)— 
Net income attributable to common stockholders$106 $283 $73 $201 
Denominator
Weighted average shares outstanding140,531 376,868 137,990 377,650 
Basic and Diluted EPS$0.75 $0.75 $0.53 $0.53 
______________________________________
(a)Participating securities include unvested restricted stock units, which include the right to receive non-forfeitable dividend equivalents.
9

4. Revenue Recognition
Disaggregation of Revenue
The Company’s revenue consists of the following categories, which aggregate into the segments – Recorded Music and Music Publishing:
Three Months Ended
June 30,		Nine Months Ended
June 30,
2024202320242023
(in millions)
Revenue by Type
Digital$882 $846 $2,638 $2,445 
Physical120 126 385 377 
Total digital and physical
1,002 972 3,023 2,822 
Artist services and expanded-rights159 218 489 555 
Licensing90 92 373 287 
Total Recorded Music1,251 1,282 3,885 3,664 
Performance52 40 155 130 
Digital194 182 577 477 
Mechanical13 16 43 46 
Synchronization42 41 129 126 
Other4 4 11 11 
Total Music Publishing305 283 915 790 
Intersegment eliminations(2)(1)(4)(3)
Total revenues
$1,554 $1,564 $4,796 $4,451 
Revenue by geographical location
U.S. Recorded Music$517 $557 $1,652 $1,618 
U.S. Music Publishing161 147 503 415 
Total U.S.678 704 2,155 2,033 
International Recorded Music734 725 2,233 2,046 
International Music Publishing144 136 412 375 
Total international
878 861 2,645 2,421 
Intersegment eliminations(2)(1)(4)(3)
Total revenues
$1,554 $1,564 $4,796 $4,451 
Sales Returns and Uncollectible Accounts
Based on management’s analysis of sales returns, refund liabilities of $19 million and $19 million were established at June 30, 2024 and September 30, 2023, respectively.
Based on management’s analysis of estimated credit losses, reserves of $23 million and $19 million were established at June 30, 2024 and September 30, 2023, respectively.
Deferred Revenue
Deferred revenue increased by $391 million during the nine months ended June 30, 2024 related to cash received from customers for fixed fees and minimum guarantees in advance of performance, including amounts recognized in the period. Revenues of $314 million were recognized during the nine months ended June 30, 2024 related to the balance of deferred revenue at September 30, 2023. There were no other significant changes to deferred revenue during the reporting period.
Performance Obligations
For the three months ended June 30, 2024 and June 30, 2023, the Company recognized revenue of $35 million and $27 million, respectively, from performance obligations satisfied in previous periods. For the nine months ended June 30, 2024 and June 30, 2023, the Company recognized revenue of $109 million and $68 million, respectively, from performance obligations satisfied in previous periods.
10

Revenues expected to be recognized in the future related to performance obligations that are unsatisfied at June 30, 2024 are as follows:
Rest of FY24
FY25
FY26
ThereafterTotal
(in millions)
Remaining performance obligations$158 $302 $27 $6 $493 
Total$158 $302 $27 $6 $493 
5. Acquisitions
On August 25, 2023, the Company purchased 51% of the issued and outstanding equity securities of TenThousand Projects Holdings LLC (“TenThousand Projects”), an independent U.S. record label pursuant to the terms of the unit purchase agreement of the same date among Warner Music Inc., a wholly-owned subsidiary of the Company, TenThousand Projects LLC, and Ten Thousand Projects Holdings LLC. The consideration transferred on the acquisition date was approximately $98 million which was comprised of the base purchase price of $102 million and the preliminary working capital adjustments, primarily comprised of cash acquired, net of a deferred purchase price of $12 million which is payable on or prior to one year from the acquisition date. The deferred purchase was adjusted to $11 million after the finalization of purchase price adjustments, including working capital and other items.
At June 30, 2024, the Company updated the purchase price allocation recorded at September 30, 2023, which resulted in a net decrease to intangible assets of approximately $1 million, a net decrease to goodwill of approximately $1 million, a net increase to other acquired assets and liabilities of $1 million, and a net decrease to the fair value of noncontrolling interest in the acquiree of $1 million. The acquisition accounting is subject to revision based on final determinations of fair value and allocations of purchase price to the identifiable assets and liabilities acquired.
See Note 5, “Acquisitions,” to the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2023 for the preliminary purchase price allocation, valuation methodology, and other information related to the TenThousand Projects acquisition.
6. Comprehensive Income
Comprehensive income, which is reported in the accompanying condensed consolidated statements of equity, consists of net income and other gains and losses affecting equity that, under U.S. GAAP, are excluded from net income. For the Company, the components of other comprehensive income primarily consist of foreign currency translation gains and losses, minimum pension liabilities, and deferred gains and losses on financial instruments designated as hedges under ASC 815, Derivatives and Hedging. The following summary sets forth the changes in the components of accumulated other comprehensive loss, net of related tax benefit of less than $1 million:
Foreign Currency Translation Loss (a)Minimum Pension Liability AdjustmentDeferred Gains (Losses) On Derivative Financial InstrumentsAccumulated Other Comprehensive Loss, net
 
(in millions)
Balances at September 30, 2023$(322)$(1)$1 $(322)
Other comprehensive income (loss)13 (1)(1)11 
Balances at June 30, 2024$(309)$(2)$— $(311)
______________________________________
(a)Includes historical foreign currency translation related to certain intra-entity transactions.
11

7. Goodwill and Intangible Assets
Goodwill
The following analysis details the changes in goodwill for each reportable segment:
Recorded
Music		Music
Publishing		Total
(in millions)
Balances at September 30, 2023$1,529 $464 $1,993 
Acquisitions3 — 3 
Other adjustments (a)7 — 7 
Balances at June 30, 2024$1,539 $464 $2,003 
______________________________________
(a)Other adjustments during the nine months ended June 30, 2024 represent foreign currency movements.
The Company performs its annual goodwill impairment test in accordance with ASC 350, Intangibles—Goodwill and Other (“ASC 350”) during the fourth quarter of each fiscal year as of July 1. The Company may conduct an earlier review if events or circumstances occur that would suggest the carrying value of the Company’s goodwill may not be recoverable. No indicators of impairment were identified during the current period that required the Company to perform an interim assessment or recoverability test.
Intangible Assets
Intangible assets consist of the following:
Weighted-Average Useful LifeJune 30,
2024		September 30,
2023
(in millions)
Intangible assets subject to amortization:
Recorded music catalog12 years$1,549 $1,507 
Music publishing copyrights24 years2,150 2,026 
Artist and songwriter contracts13 years1,103 1,091 
Trademarks18 years67 111 
Other intangible assets7 years67 104 
Total gross intangible assets subject to amortization4,936 4,839 
Accumulated amortization(2,627)(2,486)
Total net intangible assets subject to amortization2,309 2,353 
Intangible assets not subject to amortization:
Trademarks and tradenamesIndefinite150 149 
Total net intangible assets$2,459 $2,502 

The decrease in net intangible assets during the nine months ended June 30, 2024 is partially related to the write off of approximately $35 million of unamortized intangible assets within trademarks and other intangible assets in connection with the winding down of the Company’s O&O Media Properties. Please refer to Note 9 of our condensed consolidated financial statements for further discussion.
12

8. Debt
Debt Capitalization
Long-term debt, all of which was issued by Acquisition Corp., consists of the following:
June 30,
2024		September 30,
2023
(in millions)
Revolving Credit Facility (a)$— $— 
Senior Term Loan Facility due 2031
1,295 1,295 
2.750% Senior Secured Notes due 2028 (€325 face amount)
348 343 
3.750% Senior Secured Notes due 2029
540 540 
3.875% Senior Secured Notes due 2030
535 535 
2.250% Senior Secured Notes due 2031 (€445 face amount)
477 471 
3.000% Senior Secured Notes due 2031
800 800 
Mortgage Term Loan due 203318 $18 
Total long-term debt, including the current portion$4,013 $4,002 
Issuance premium less unamortized discount and unamortized deferred financing costs(35)(38)
Total long-term debt, including the current portion, net$3,978 $3,964 
______________________________________
(a)Reflects $350 million and $300 million of commitments under the Revolving Credit Facility, less letters of credit outstanding of approximately $2 million and $2 million as of June 30, 2024 and September 30, 2023, respectively. There were no loans outstanding under the Revolving Credit Facility at June 30, 2024 or September 30, 2023.
The Company is the direct parent of Holdings, which is the direct parent of Acquisition Corp. Acquisition Corp. is party to a $1,295 million senior secured term loan credit facility, pursuant to a credit agreement dated November 1, 2012, as amended or supplemented (the “Senior Term Loan Credit Agreement”) with JPMorgan Chase Bank NA, as administrative agent and collateral agent, and the other financial institutions and lenders from time to time party thereto (the “Senior Term Loan Facility”). Additionally, as of June 30, 2024 Acquisition Corp. had issued and outstanding the 2.750% Senior Secured Notes due 2028, the 3.750% Senior Secured Notes due 2029, the 3.875% Senior Secured Notes due 2030, the 2.250% Senior Secured Notes due 2031 and the 3.000% Senior Secured Notes due 2031 (together, the “Acquisition Corp. Notes”).
All of the Acquisition Corp. Notes are guaranteed by all of Acquisition Corp.’s domestic wholly-owned subsidiaries. The guarantee of the Acquisition Corp. Notes by Acquisition Corp.’s domestic wholly-owned subsidiaries is full, unconditional and joint and several. The secured notes are guaranteed on a senior secured basis.
The Company and Holdings are holding companies that conduct substantially all of their business operations through Acquisition Corp. Accordingly, while Acquisition Corp. and its subsidiaries are not currently restricted from distributing funds to the Company and Holdings under the indentures for the Acquisition Corp. Notes or the credit agreements for the Acquisition Corp. Senior Credit Facilities, including the Revolving Credit Facility (as defined below) and the Senior Term Loan Facility, should Acquisition Corp.’s Total Indebtedness to EBITDA Ratio increase above 3.50:1.00 and the term loans not achieve an investment grade rating, the covenants under the Revolving Credit Facility, which are currently suspended, will be reinstated and the ability of the Company and Holdings to obtain funds from their subsidiaries will be restricted by the Revolving Credit Facility. The Company was in compliance with its covenants under its outstanding notes, the Revolving Credit Facility and the Senior Term Loan Facility as of June 30, 2024.
13

Fiscal 2024 Transactions
Revolving Credit Agreement Amendment
On November 30, 2023, Acquisition Corp. entered into an amendment (the “Revolving Credit Agreement Amendment”) to the revolving credit agreement, dated January 31, 2018, as amended, among Acquisition Corp., the several banks and other financial institutions party thereto and Credit Suisse AG, Cayman Islands Branch, as predecessor administrative agent, governing Acquisition Corp.’s revolving credit facility (the “Revolving Credit Facility”) with JPMorgan Chase Bank, N.A., as administrative agent, and the other financial institutions and lenders from time to time party thereto. The Revolving Credit Agreement Amendment (among other changes): (i) increased the commitments under the Revolving Credit Facility from an aggregate principal amount of $300 million to an aggregate principal amount of $350 million, (ii) extended the final maturity date of the Revolving Credit Facility from April 3, 2025 to November 30, 2028, (iii) appointed JPMorgan Chase Bank, N.A. as administrative agent in the place of Credit Suisse AG, Cayman Islands Branch, (iv) modified the existing springing Secured Indebtedness to EBITDA Ratio financial maintenance covenant by increasing the springing threshold from $105,000,000 to $140,000,000, and (v) included provisions that allow Acquisition Corp. to terminate the security interests securing the obligations under the Revolving Credit Facility upon the satisfaction of the Collateral Suspension Conditions (as defined below) and, in the event that the security interests are so terminated, the existing springing Secured Indebtedness to EBITDA Ratio financial maintenance covenant (which is calculated net of up to $250 million of cash and cash equivalents held by Acquisition Corp. and its restricted subsidiaries) shall automatically be replaced with a new financial maintenance covenant prohibiting Acquisition Corp. from permitting the Total Indebtedness to EBITDA Ratio to be greater than 3.60:1.00 (calculated net of all cash and cash equivalents held by Acquisition Corp. and its restricted subsidiaries) as of the end of any fiscal quarter.

In the event that the security interests securing the obligations under the Facility are reinstated as a result of the occurrence of a Collateral Suspension Reversion Date (as defined below), the Total Indebtedness to EBITDA Ratio financial maintenance covenant shall revert back to a springing Secured Indebtedness to EBITDA Ratio financial maintenance covenant set at 5.00:1.00.

For purposes the Revolving Credit Agreement Amendment, (i) “Collateral Suspension Conditions” means conditions that are satisfied if (x) the investment grade condition has been satisfied and (y) the aggregate outstanding principal amount of senior secured indebtedness incurred by Acquisition Corp. and its restricted subsidiaries is not in excess of $500,000,000 and (ii) “Collateral Suspension Reversion Date” means, the earlier of (x) the date on which the Collateral Suspension Conditions cease to be satisfied or (y) the date on which Acquisition Corp. delivers a collateral suspension reversion notice to the Administrative Agent.

December 2023 Senior Term Loan Credit Agreement Amendment
On December 29, 2023, Acquisition Corp. entered into an amendment (the “Thirteenth Amendment”) to the Senior Term Loan Credit Agreement among Acquisition Corp., the other loan parties, Holdings, each lender party hereto, Credit Suisse AG, Cayman Islands Branch as the resigning administrative agent, and JPMorgan Chase Bank, N.A, as the successor administrative agent. The Thirteenth Amendment appointed JPMorgan Chase Bank, N.A. as administrative agent in the place of Credit Suisse AG, Cayman Islands Branch.
Senior Term Loan Credit Agreement Amendment

On January 24, 2024, Acquisition Corp.”) entered into an amendment (the “Senior Term Loan Credit Agreement Amendment”) to the credit agreement, dated November 1, 2012 (as amended by the amendments dated as of May 9, 2013, July 15, 2016, November 21, 2016, May 22, 2017, December 6, 2017, March 14, 2018, June 7, 2018, January 20, 2021, March 8, 2021, November 1, 2022, May 10, 2023, June 30, 2023 and December 29, 2023), among Acquisition Corp., the guarantors party thereto, the lenders party thereto and JPMorgan Chase Bank, N.A., as administrative agent, governing Acquisition Corp.’s senior secured term loan facility with JPMorgan Chase Bank N.A., as administrative agent, and the other financial institutions and lenders from time to time party thereto. The Senior Term Loan Credit Agreement Amendment (among other changes) extends the maturity date of its outstanding term loans from January 20, 2028 to January 24, 2031 through the issuance of tranche I term loans and refinancing of the existing tranche G term loans. The tranche I term loans shall bear interest at a rate equal to, at Acquisition Corp.’s election (i) the forward-looking term rate based on the secured overnight financing rate as administered by the Federal Reserve Bank of New York for the applicable interest period (“Term SOFR”) subject to a zero floor, plus 2.00% per annum or (ii) the base rate, which is the highest of (x) the corporate base rate established by the administrative agent as its prime rate in effect at its principal office in New York City from time to time, (y) 0.50% in excess of the overnight federal funds rate and (z) one-month Term SOFR, plus 1.00% per annum, in each case, subject to a 1.00% floor, plus 1.00% per annum. In connection with the Senior Term Loan Credit Agreement Amendment, the Company recognized approximately $3 million of expenses associated with fees paid to third parties and capitalized approximately $2 million in fees paid to creditors. Certain participating lenders were repaid and replaced by new lenders. The proceeds and repayments of $42 million have been presented in the accompanying condensed consolidated statement of cash flows.
14

Interest Rates
The loans under the Revolving Credit Facility bear interest at Acquisition Corp.’s election at a rate equal to (i) the secured overnight financing rate as administered by the Federal Reserve Bank of New York for the applicable interest period (“Revolving Term SOFR”), and other rates for alternate currencies, such as EURIBOR and SONIA, as provided in the Revolving Credit Agreement, subject to a zero floor, plus 1.75% per annum in the case of Initial Revolving Loans (as defined in the Revolving Credit Agreement), or 1.875% per annum in the case of 2020 Revolving Loans (as defined in the Revolving Credit Agreement), or (ii) the base rate, which is the highest of (x) the corporate base rate established by the administrative agent from time to time, (y) 0.50% in excess of the overnight federal funds rate and (z) the one-month Revolving Term SOFR plus 1.0% per annum, plus, in each case, 0.75% per annum in the case of Initial Revolving Loans, or 0.875% per annum in the case of 2020 Revolving Loans; provided that, in respect of 2020 Revolving Loans, the applicable margin with respect to such loans is subject to adjustment as set forth in the pricing grid in the Revolving Credit Agreement. Based on the Senior Secured Indebtedness to EBITDA Ratio of 2.41x at June 30, 2024, the applicable margin for SOFR loans and RFR loans would be 1.375% instead of 1.875% and the applicable margin for ABR loans would be 0.375% instead of 0.875% in the case of 2020 Revolving Loans. If there is a payment default at any time, then the interest rate applicable to overdue principal will be the rate otherwise applicable to such loan plus 2.0% per annum. Default interest will also be payable on other overdue amounts at a rate of 2.0% per annum above the amount that would apply to an alternative base rate loan.
The loans under the Senior Term Loan Facility bear interest at Acquisition Corp.’s election at a rate equal to (i) the forward-looking term rate based on Term SOFR subject to a zero floor, plus 2.00% per annum or (ii) the base rate, which is the highest of (x) the corporate base rate established by the administrative agent as its prime rate in effect at its principal office in New York City from time to time, (y) 0.50% in excess of the overnight federal funds rate and (z) one-month Term SOFR, plus 1.00% per annum, subject to a 1.00% floor, plus, in each case, 1.00% per annum. If there is a payment default at any time, then the interest rate applicable to overdue principal and interest will be the rate otherwise applicable to such loan plus 2.00% per annum. Default interest will also be payable on other overdue amounts at a rate of 2.00% per annum above the amount that would apply to an alternative base rate loan.
The term loan entered into on January 27, 2023 (the “Term Loan Mortgage”) bears interest at a rate of 30-day SOFR plus the applicable margin of 1.40%, subject to a zero floor.
The Company has entered into, and in the future may enter into, interest rate swaps to manage interest rate risk. Please refer to Note 13 of our condensed consolidated financial statements for further discussion.
Maturity of Senior Term Loan Facility
The loans outstanding under the Senior Term Loan Facility mature on January 24, 2031.
Maturity of Revolving Credit Facility
The maturity date of the Revolving Credit Facility is November 30, 2028.
Maturities of Senior Secured Notes
As of June 30, 2024, there are no scheduled maturities of notes until 2028, when $348 million is scheduled to mature. Thereafter, $2.352 billion is scheduled to mature.
Maturity of Term Loan Mortgage
The maturity date of the Term Loan Mortgage is January 27, 2033, subject to a call option exercisable by Truist Bank at any time after January 27, 2028 if certain criteria relating to the Company’s creditworthiness are met.
Interest Expense, net
Total interest expense, net was $40 million and $38 million for the three months ended June 30, 2024 and 2023, respectively, and $121 million and $105 million for the nine months ended June 30, 2024 and 2023, respectively. Interest expense, net includes interest expense related to our outstanding indebtedness of $46 million and $41 million for the three months ended June 30, 2024 and 2023, respectively, and $137 million and $115 million for the nine months ended June 30, 2024 and 2023, respectively. The weighted-average interest rate of the Company’s total debt was 4.5% at June 30, 2024, 4.1% at September 30, 2023, and 4.1% at June 30, 2023.

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9. Restructuring and Impairments
Strategic Restructuring Plan
In February 2024, the Company announced a strategic restructuring plan (the “Strategic Restructuring Plan”) designed to free up additional funds to invest in music and accelerate the Company’s growth for the next decade. Under the Strategic Restructuring Plan, the Company expects a reduction in headcount of approximately 10% of the Company’s overall headcount. The Company expects to incur total non-recurring restructuring charges of approximately $135 million or approximately $80 million of total non-recurring after tax charges. The expected pre-tax charges include approximately $85 million of severance costs and approximately $50 million of non-cash impairment charges primarily in connection with the disposal or winding down of the Company’s non-core owned and operated media properties including the Company’s in-house advertising sales function (the “O&O Media Properties”). The majority of the Strategic Restructuring Plan is expected to be completed by the end of fiscal year 2025.
For the three months ended June 30, 2024, total severance costs recorded in connection with the Strategic Restructuring Plan were $1 million, all of which was recognized in our Recorded Music segment. For the nine months ended June 30, 2024, total severance costs recorded in connection with the Strategic Restructuring Plan were $47 million, of which, $43 million was recognized in our Recorded Music segment and $4 million was recognized in Corporate. The below table sets forth the activity for the nine months ended June 30, 2024 in the restructuring accrual associated with the Strategic Restructuring Plan included within accrued liabilities in the accompanying condensed consolidated balance sheets. Additionally, for the nine months ended June 30, 2024, the Company recognized $50 million of impairment losses on unamortized intangible assets and other assets of which $47 million was recognized in our Recorded Music segment and $3 million was recognized in Corporate. Impairment charges recognized primarily relate to the winding down of the Company’s O&O Media Properties.
Severance Costs
(in millions)
Balance at September 30, 2023$— 
Restructuring charges47 
Cash payments(9)
Balance at June 30, 2024$38 
2023 Restructuring Plan
In March 2023, the Company announced a restructuring plan (the “2023 Restructuring Plan”) intended to drive the evolution of the Company and position the Company for long-term growth, primarily through headcount reductions. The 2023 Restructuring Plan is substantially complete as of June 30, 2024 and the remaining associated cash payments are expected to be made by the end of fiscal year 2024. There was a $1 million benefit associated with the 2023 Restructuring Plan recorded for the nine months ended June 30, 2024 primarily associated with a change in estimate for costs previously recorded.
The following table sets forth the activity for the nine months ended June 30, 2024 in the restructuring accrual associated with the 2023 Restructuring Plan included within accrued liabilities in the accompanying condensed consolidated balance sheets:
Severance Costs
(in millions)
Balance at September 30, 2023$19 
Restructuring charges(1)
Cash payments(15)
Balance at June 30, 2024$3 
10. Commitments and Contingencies
From time to time the Company is involved in claims and legal proceedings that arise in the ordinary course of business. The Company is currently subject to several such claims and legal proceedings. Based on currently available information, the Company does not believe that resolution of pending matters will have a material adverse effect on its financial condition, cash flows or results of operations. However, litigation is subject to inherent uncertainties, and there can be no assurances that the Company’s defenses will be successful or that any such lawsuit or claim would not have a material adverse impact on the Company’s business, financial condition, cash flows and results of operations in a particular period. Any claims or proceedings against the Company, whether meritorious or not, can have an adverse impact because of defense costs, diversion of management and operational resources, negative publicity and other factors.
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11. Equity
Stock-Based Compensation
The Company’s stock-based compensation plans are described in Note 14, “Equity,” to the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2023. Stock-based compensation consists primarily of common stock, restricted stock units and market-based performance share units granted to eligible employees and executives under the Omnibus Incentive Plan.
For the three and nine months ended June 30, 2024, the Company recognized a total of $10 million and $28 million of non-cash stock-based compensation expense, respectively, which was recorded to additional paid-in capital. For the three months ended June 30, 2023, the Company recognized a total of $7 million of non-cash stock-based compensation expense, all of which was recorded to additional paid-in capital. For the nine months ended June 30, 2023, the Company recognized a total of $42 million of non-cash stock-based compensation expense, of which $27 million was recorded to additional paid-in capital and $15 million was recorded as a share-based compensation liability. During the nine months ended June 30, 2024, $15 million of share-based compensation liabilities were reclassified to additional paid-in capital upon a certain number of awards being determinable.
During the nine months ended June 30, 2023, a separation agreement between the Company and our previous Chief Executive Officer was executed. In connection with the separation agreement, the Company recognized $12 million of non-cash stock-based compensation expense associated with restricted stock units (“RSUs”) and common stock as there was no remaining service required for vesting.
During the nine months ended June 30, 2024 and 2023, the Company issued market-based performance share units (“PSUs”) to our Chief Executive Officer whereby the PSU award payout is determined based on the Company’s total shareholder return compared to a designated peer group. For the three and nine months ended June 30, 2024, non-cash stock-based compensation associated with these PSUs was approximately $3 million and $6 million, respectively. For the three and nine months ended June 30, 2023, non-cash stock-based compensation associated with these PSUs was approximately $1 million and $2 million, respectively.
During the nine months ended June 30, 2023, in connection with the 2023 Restructuring Plan, the Company recognized $2 million of non-cash stock-based compensation related to the accelerated vesting of certain RSUs.
Common Stock
During the nine months ended June 30, 2024, in connection with the Senior Management Free Cash Flow Plan (the “Plan”), the Company issued a total of 1,738,016 shares of Class A Common Stock to settle a portion of participants’ deferred equity units previously issued under the Plan. Additionally, a Plan participant redeemed a portion of their vested Class B equity units of WMG Management Holdings LLC in exchange for a total of 1,335,169 shares of Class B Common Stock which were converted to shares of Class A Common Stock upon the exchange.
During the three and nine months ended June 30, 2024, the Company issued approximately 7,428 and 185,115 shares of Class A Common Stock, respectively, under the Omnibus Incentive Plan which were net of shares used to settle employee income tax obligations of approximately $5 million.
12. Income Taxes

For the three and nine months ended June 30, 2024, the Company recorded an income tax expense of $30 million and $120 million, respectively. The income tax expense for the three months ended June 30, 2024 is lower than the expected tax expense at the statutory rate of 21% primarily due to benefit related to updated allowable costs for reported foreign derived intangible income (“FDII”) , non-controlling interest, and the net impact of GILTI and FDII. These benefits were partially offset by foreign income taxed at rates higher than the United States, withholding taxes, and U.S. state and local taxes. The income tax expense for the nine months ended June 30, 2024 is lower than the expected tax expense at the statutory rate of 21% primarily due to the tax benefit from the winding down of the Company’s O&O Media Properties, updated allowable costs for FDII, non-controlling interest, the net impact of GILTI and FDII and tax benefits associated with Research and Development (“R&D”) credits. These benefits were partially offset by withholding taxes, foreign income taxed at rates higher than the United States, U.S. state and local taxes, non-deductible executive compensation under IRC Section 162(m), and unrecognized tax benefit related to uncertain tax positions.
For the three and nine months ended June 30, 2023, the Company recorded an income tax expense of $43 million and $112 million, respectively. The income tax expense for the three and nine months ended June 30, 2023 is higher than the expected tax benefit at the statutory tax rate of 21% primarily due to foreign income taxed at rates higher than the United States, including withholding taxes, U.S. state and local taxes, unrecognized tax benefit related to uncertain tax positions, and non-deductible executive
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compensation under IRC Section 162(m). These charges were partially offset by tax benefits associated with R&D credits, release of U.S. state valuation allowance, and the net impact of GILTI and FDII.
The Company has determined that it is reasonably possible that the gross unrecognized tax benefits as of June 30, 2024 could decrease by up to approximately $2 million related to various ongoing audits and settlement discussions in various jurisdictions during the next twelve months.
The Organization for Economic Co-operation and Development (“OECD”) introduced Base Erosion and Profit Shifting (“BEPS”) Pillar 2 rules that impose a global minimum tax rate of 15%. Numerous countries, including European Union member states, have enacted or are expected to enact legislation to be effective as early as January 1, 2024, with general implementation of a global minimum tax rate by January 1, 2025. The Company is currently evaluating the potential impact of the rules.
The Inflation Reduction Act of 2022 (H.R. 5376) includes a 15% corporate alternative minimum tax (“CAMT”) on adjusted financial statement income for corporations with average profits over $1 billion over a three-year period. Although the U.S. Treasury and Internal Revenue Service issued interim CAMT guidance during 2023, many details and specifics of application of the CAMT remain subject to future guidance. The Company is not expecting to be subject to CAMT for our fiscal year 2024.
13. Derivative Financial Instruments
The Company uses derivative financial instruments, primarily foreign currency forward exchange contracts and interest rate swaps, for the purposes of managing foreign currency exchange rate risk and interest rate risk on expected future cash flows.
The fair value of interest rate swaps is based on dealer quotes of market rates (i.e., Level 2 inputs) which is discussed further in Note 20, “Fair Value Measurements,” to the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2023. Interest income or expense related to interest rate swaps is recognized in interest income (expense), net in the same period as the related expense is recognized. The ineffective portions of interest rate swaps are recognized in other income (expense) in the period measured.
As of June 30, 2024, the Company had outstanding foreign currency forward exchange contracts for the sale of $175 million and the purchase of $108 million of foreign currencies at fixed rates that will be settled by September 2024.
As of June 30, 2024, the Company had no outstanding interest rate swaps and no unrealized deferred gains or losses in comprehensive income related to the interest rate swaps. As of September 30, 2023, the Company had outstanding $500 million in a pay-fixed receive-variable interest rate swap with $1 million of unrealized deferred gains in comprehensive income related to the interest rate swaps.
The Company recorded realized pre-tax losses of $1 million and unrealized pre-tax gains of $1 million related to its foreign currency forward exchange contracts in the condensed consolidated statement of operations as other expense for the nine months ended June 30, 2024. The Company recorded realized pre-tax losses of $6 million and unrealized pre-tax losses of $1 million related to its foreign currency forward exchange contracts in the condensed consolidated statement of operations as other expense for the nine months ended June 30, 2023.
The unrealized pre-tax losses of the Company’s derivative interest rate swaps designated as cash flow hedges recorded in other comprehensive income during the nine months ended June 30, 2024 and June 30, 2023 were $1 million and $11 million, respectively.
The following is a summary of amounts recorded in the consolidated balance sheets pertaining to the Company’s derivative instruments at June 30, 2024 and September 30, 2023:
June 30,
2024		September 30,
2023
(in millions)
Other Current Assets:
Foreign currency forward exchange contracts (a)
1