Ooof. Analysts who had been cautiously raising their estimates on Warner Music Group (WMG) in the past few weeks won't like this: Though the company beat the Street's revenue estimates, it blew its 2Q EPS goal by a wide margin.

Revenue: $800M, up 2% y/y vs. consensus of $776M. But take out the weak dollar and things look less sunny: Revenues declined 3.6% on a constant currency basis. Domestic revenues down 13.8%, International up 19.9%, but only 6.7% on constant currency.

OI: $28 million, up 47% y/y

EBITDA: $96M, up 20% y/y consensus of $92M

EPS: loss of 23 cents; consensus of -$0.13

Digital revenue: $164 million, up 48 y/y, up 16% sequentially. 21% of total revenue.

The explanation for the dividend suspension, via CFO Michael Fleisher:

'We regularly evaluate our capital deployment strategy. Our Board and our management believe it is sensible to maximize capital flexibility, given the vagaries of both the economy and recorded music market, by suspending our dividend to build cash reserves and reduce net debt. This action will give us the freedom to maintain our level of A&R investment, while enhancing shareholder returns over time.'

Immediate speculation will center on whether the move Warner is worried about servicing its $2.27 billion in debt. We'll listen in on 8:30 conference call and cover it live.