Reservoir Media, Inc. (NASDAQ:RSVR) Q3 2023 Earnings Call Transcript

Operator: Thank you. Our next question comes from the line of Alex Fuhrman from Craig-Hallum. Your line is open.

Alex Fuhrman: Hi everyone. Thanks for taking my question. And congratulations on another strong quarter. It seems like you’re making a lot of investments in emerging markets in addition to PopArabia, more recently some bigger investments in India. Can you talk a little bit more about how big an opportunity India is both in terms of content creation from Indian artists and then as well as actual consumption of media within India?

Golnar Khosrowshahi: So I think that from a volume standpoint, it’s certainly that we are making investments in the emerging markets. I wouldn’t think about these investments as being significant — as significant as others that you know about from a dollar standpoint. And obviously, we’re very interested in continuing those investments through PopArabia and growing the business there. Based on really what the forecasted growth in these emerging markets is, and I don’t have sort of isolated numbers around India in front of me, but we are looking at growth that is predicted north of 40%. The only markets that actually share that kind of predicted growth are the Latin American and Middle Eastern markets. So we are very keen on continuing to invest in existing content in this region as well as investing in our roster, building on the JV we have with DIVINE’s Gully Gang and just really having access to content in this region, which could position us as being a very significant rights holder within the next 18 months or so.

Alex Fuhrman: Okay. That’s very helpful, Golnar. Thank you. And then just as a housekeeping, with the CRB 4 settlement and the new rates set to take effect here in 2023, I mean, should we think about that as being effectively the royalty rate that is baked into your Q4 guidance for the first three months of 2023?

Jim Heindlmeyer: Yes, certainly. These rates take effect January 1. So for our fourth quarter, our revenue related to U.S. digital streaming on the mechanical side will be reflective of those rates. So yes, that aspect of it is baked into our numbers.

Alex Fuhrman: Okay. Thanks very much, Jim.

Operator: Thank you. And I’m not showing any further questions in the queue. I’d like to turn the call back over to Golnar Khosrowshahi for any closing remarks.

Golnar Khosrowshahi: Thank you, Operator. Our performance in the third quarter is indicative of both the strength of our team at Reservoir and the quality of assets that we have assembled. I thank you so much for joining us this morning. We look forward to updating you on our progress on our next call. Thank you.

Operator: This concludes today’s conference call. Thank you for participating. You may now disconnect. Everyone, have a great day.