Principle Management, the company that oversaw U2’s career from 1978 until it was bought out last year by Live Nation and renamed Evergreen Ventures, is reported to have lost more than $2.5 million in 2013. This is the fourth year in a row that the company has lost money.
Wow. Dire, huh? No.
Like any other business entity, Principle can only reports profits when revenues exceed expenses. Because U2 hasn’t been doing anything except spending money since the the 360 Tour ended on June 30, 2011, revenues have have pretty much dried up. Other Principle acts (and there are only two: the Rapture and PJ Harvey) haven’t exactly been super-active, either. And even if they were, they certainly wouldn’t be bringing in much dosh.
However, the care and feeding on of the biggest band in the world costs money. There are fixed costs associated with running Principle (staff, travel, rent, etc.)–and there have been massive outlays of capital as U2 records their new album.
In other words, this is normal business for Principle. It’s the kind of thing you budget for: years of plenty (when U2 is active) and years of losses (when they’re not.) And you can bet that they have the best accountants and tax lawyers in the business looking after the books.
So if anyone looks at this story and comes away with the sense that U2 is any kind of financial trouble, they should give their head a shake.