Vivendi announced its 2007 earnings last week (download PDF of earnings release). Yeah, I'm a bit late on this one. EBITA dropped 16.1% (12.9% at constant currency). Digital sales increased 51% (at constant currency).

These slight revenue drops are par for today's course, but they don't tell the entire story. It's important to keep in mind that UMG and the other majors are acquiring quite a bit of revenue. It's one thing to grow revenue organically and another to buy revenue. The only organic growth, digital, isn't enough to offset losses related to CD sales. Music companies have always been active acquirers, though, so there's no reason to look for any red flags that aren't already visible -- M&A happens in both good and bad years.

UMG's 2007 revenue most likely includes partial-year revenue from two main acquisitions, BMG's music publishing (bid in late 2006, got E.U. approval in May 2007, had 2006 revenues of €362 million but divested some publishing assets to gain E.U. approval) and Sanctuary Music Group (acquired in July 2007 and good for about £150 million in annual revenue). In 2008, UMG will add to its top line the revenues of Univision's recorded music and publishing divisions.