Goldman Sachs says A.I. will 'super-charge' music creation and names 5 stocks to buy

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Generative AI is providing 'significant opportunities' in the music industry, according to Goldman Sachs, which says concerns over the technology are overblown.

The music industry is set for a radical shift due in part to generative AI, according to Goldman Sachs , which described the new technology as providing "significant opportunities" for the sector. It named five buy-rated stocks to play the trend: Live Nation , Warner Music Group , French digital music company Believe , China's NetEase , and Universal Music Group . All of the stocks are on its conviction list of top stocks.

Streaming means it's easier than ever for people to access music, but revenue has not matched consumption, the analysts noted. "For example, we estimate that the revenue per audio stream has fallen 20% in the past 5 years and that the revenue per hour streamed of music for Spotify is 4x lower than for Netflix ," the bank stated. Goldman likes events promoter Live Nation as it expects artists to tour more frequently due to what it calls the globalization of music.

 

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