By Reuters | Updated: 27 July 2022
Spotify reported second-quarter revenue above analysts’ estimates on Wednesday, helped by a 14 percent jump in paying subscribers as more users listened to its podcasts, and the company forecast an upbeat current quarter. The Swedish music streaming company posted a 23 percent increase in revenue to EUR 2.9 billion (roughly Rs. 23,550 crore), beating analysts’ expectations of EUR 2.8 billion (roughly Rs. 22,740 crore), according to IBES data from Refinitiv.
Premium subscribers, which account for most of the company’s revenue, rose to 188 million, beating analysts’ expectations of 187 million.
Total monthly active users rose 19 percent to 433 million. Analysts had expected 428 million.
Spotify, which had been aggressively hiring in the first two quarters, has slowed headcount growth by 25 percent beginning in the third quarter, while also taking a closer look at marketing activity. Last month, Spotify Technology SA Chief Executive Officer Daniel Ek informed the staff via email that the audio streaming company would reduce its hiring by 25 percent, according to a source familiar with the contents of the email.
Ek said Spotify would continue hiring, though it would slow the pace “and be a bit more prudent” of over the next few quarters.
The company forecast current-quarter paid subscribers of 194 million, in line with expectations. It expects revenue of EUR 3 billion (roughly Rs. 24,360 crore), above estimates of EUR 2.95 billion (roughly Rs. 24,000 crore).
Spotify has bet big on podcasts, investing over a billion dollars in acquiring shows such as the The Joe Rogan Experience and other businesses in a bid to draw users to a growing non-music audio segment.
The company said podcast listeners reached a record in the quarter, as members choose from among 4.4 million podcasts.
The company expects total monthly active users of 450 million in the third quarter.
© Thomson Reuters 2022
