Spotify misses its own targets for subscription customers
Music streaming provider Spotify did not gain as many paying users as hoped in the past quarter. Although the number of subscription customers rose from 100 to 108 million, which was within the forecast range, the company had targeted one million more.
At the same time, the company stressed on Wednesday that the reason was its own mistakes and not a weakness in the market. By the fourth quarter, Spotify wants to have up to 125 million paying users.
Subscription customers are extremely important for Spotify - they brought in 90 percent of the streaming service's total revenue of around EUR 1.67 billion. Revenues grew by 31 percent year-on-year. On the bottom line, Spotify was still in the red, but narrowed its loss to 76 million euros from 142 million a year earlier. Spotify shares lost a good two percent in pre-market US trading.
Most Spotify users still access the free version of the service with advertising and a limited range of functions. The total number of users rose from 217 to 232 million within three months, exceeding Spotify's predictions.
Spotify has recently invested heavily in expanding its podcast offering, and it's having an impact. The number of podcast users increased by 50 percent within three months and has doubled since the beginning of the year.
Spotify is the clear number one in music streaming, followed by Apple Music with a good 60 million subscription customers. The iPhone company does not offer a free version of its service. (sda)
