Music industry takes hit

LOS ANGELES. Warner Music Group Corp., whose artists include R.E.M., Madonna and Green Day, said Thursday that higher costs and a shift to digital music resulted in a wider second-quarter loss and it suspended dividends.

Shares tumbled more than 20 percent, or $1.87, to $7.18 in morning trading.

For the period ended March 31, the New York-based recording company reported a loss of $37 million, compared with a loss of $27 million a year earlier.

Revenue grew 2 percent to $800 from $784 million a year earlier.

Overall recorded music sales were essentially flat during the quarter, rising 0.6 percent to $652 million versus a year earlier, as retailers shifted inventory amid a slowing economy and demand for more digital music.