WMG Stock Falls After Downgrade

Warner Music Group stock fell 11% yesterday after  a Golman Sachs analyst downgraded the stock from Neutral to Sell. Ingrid Chung said WMG will find it difficult to manage costs as revenue continues to drop.  U.S. album sales fell 11% in the first 6 months of 2008 according to Nielsen SoundScan.

“WMG will find it increasingly difficult to improve its U.S. market share, after six straight quarters of doing so,” said Chung.  She cut her revenue forecast for the company to $783
million from $830 million.

Is it finally time to cut costs in the executive suite as EMI has done? Or maybe Edgar and Lyor will finally take me up on Hypebot’s challenge to work for $1 plus bonuses like Steve Jobs.