Goldman Sachs has raised its recorded music revenue forecast for the first time since 2022, projecting $56.1 billion by 2035. Its Music in the Air 2026 report expects industry growth alongside risks for record labels.
The firm favors music and audio distributors and live entertainment businesses, while taking a more selective investment approach to music rights owners.
Revenue growth through 2035
Goldman forecasts growth across recorded music, publishing and live entertainment, with subscription streaming revenue for rights holders expected to outpace the broader industry.
- Recorded music: 5.9% compound annual growth rate (CAGR) through 2035, reaching $56.1 billion.
- Subscription streaming rights holder revenue: 7.1% CAGR through 2035.
- Recorded music, publishing and live combined: 5.8% CAGR through 2035.
The report describes live music as “one of the strongest growth stories in media” and projects continued expansion through 2035.
Its selective position on rights owners follows share-price difficulties at Universal Music and, to a lesser extent, Warner Music.
Streaming monetization opportunities
Goldman’s outlook for distributors reflects expansion in developing markets, tighter monetization of multi-user plans and additional features. The report identifies several areas:
- Audiobooks.
- Artificial intelligence (AI) tools.
- Reserved.
- High-fidelity audio.
One proposed approach to Family plans would charge “a modest fee” for each listener, replacing a flat monthly price covering up to six users.
Goldman also expects ad-supported streaming to reverse years of weak results. It identifies subscription options between free access and premium plans as another potential source of growth.
AI revenue potential and label risks
The report estimates that AI licensing, creation tools and new monetization opportunities could add approximately 10% to recorded music revenue by 2035.
Alongside those opportunities, Goldman identifies longer-term risks for labels as generative AI makes music creation more accessible and increases competition for listening and royalties.
The report warns that millions of AI-generated tracks entering streaming services could dilute labels’ market share and redirect part of the royalty pool away from human-created intellectual property.
