Warner Music Group has reported robust results for the first three months of 2021 as revenues rose nearly 17% to $1.25b, with syncs rebounding and physical sales spiking.

Naturally, streaming kept the lights on; digital revenue was up 23% in WMG’s fiscal Q2 to $860m, representing nearly 69% of all income. Physical sales were up more than 20% to $118m.

“The continued strength of our core streaming business was bolstered by impressive growth in revenue from emerging streaming platforms, which drove healthy margins and free cash flow,” said WMG EVP/CFO Eric Levin.

WMG CEO Steve Cooper noted in a call with analysts that new platforms such as TikTok and Peloton represent $200m in annual income.

In prepared remarks, Cooper was bullish on virtual concerts and WMG’s commitment to growing that business, NFTs and digital collectibles, and a “new level of inventiveness” as the industry emerges from the pandemic.

Cooper spelled out the WMG investment philosophy, reflected in recent alliances with Genies and Wave. The goal, he said, is to “make investments from the perspective of how can these help us amplify music, how can they amplify touchpoints with fandom, how can they create and monetize new revenue streams?”

WMG is investing in companies that are creating metaverses that “track the eyeballs and ears of billions of people.” “All recent investments are focused on us having the technology, tools and access to continue to grow these worlds at meaningful double-digit numbers," Cooper said.

Operating income was $151m, compared to an operating loss of $49m in the prior-year quarter. Net income was $117m, compared to a net loss of $74m in the prior-year quarter.

Major sellers in the quarter included Dua Lipa, Michael Bublé, Ed Sheeran, Ava Max and, in Japan, The Yellow Monkey. Neil Young and Fleetwood Mac catalog titles led vinyl sales.

Overall, WMG is cautious when it comes to the physical marketplace, especially CDs. LPs, though, have a future. “Vinyl is a long-term attractive market,” Levin said.

Music publishing revenue was up 16% to $192m. Synchronization revenue increased due to growth in motion picture and commercial income over early 2020, when COVID-19 started to affect the world.