The results were released a week after Warner said it plans to purchase Parlophone — the label of acts like Coldplay, David Guetta and Radiohead — for $765 million from Universal Music by the middle of the year.
The net loss in the three months to Dec. 31 came to $80 million, bigger than the loss of $26 million in the same period a year earlier.
The quarter's results suffered from an $83 million loss on the extinguishment of debt. There was no such charge a year earlier.
Revenue fell 1 percent to $769 million from $775 million a year ago.
Sales of compact discs and other physical formats declined 12 percent to $300 million, but digital music sales rose 16 percent to $237 million. Both figures exclude the impact of currency movements.
Digital revenue accounted for 33 percent of total revenue, up from 28 percent a year ago.
Cooper called the deal a unique opportunity "to combine forces with legendary record labels and artists" while "maintaining our commitment to financial discipline."
Warner Music is no longer a publicly traded company since it was taken private by billionaire Len Blavatnik's Access Industries for about $1.3 billion in July 2011. It still reports its earnings publicly because it has publicly traded debt.