The Swedish music streaming company, Spotify, has revealed today that it has recorded a huge increase in its revenue and monthly active users. This is contained in the company’s second-quarter 2022 earning reports released today.
Spotify reported a 23% increase in revenue to 2.9 billion euros ($2.94 billion), exceeding analysts’ expectations of 2.8 billion euros, and a 19% increase in monthly active users to 433 million, an adjusted net gain of 19 million in Q2 and 5 million above guidance – Spotify’s largest-ever Q2 growth.
Spotify’s Premium Subscribers increased 14 percent to 188 million, exceeding expectations by 6 million, thanks to “promotional intake and household plans.” The company attributed the gains to European reactivations, “Gen Z strength in Latin America,” and global marketing campaigns outside of its core regions.
Similarly, the company’s ad-supported revenue increased by 31% to €360 million, reaching an all-time high of 13% of total revenue. Subscription revenue increased 22% year on year to €2.50 million, with average revenue per sub increasing 6% to €4.54. The previous Q2 forecast called for 428 million monthly users and 187 million paying subscribers, with revenue of €2.80 billion and a net loss of €197 million.
Spotify’s gross margin was 24.6 percent in the second quarter, compared to 28.4 percent in Q2 2021. This was “negatively impacted by our decision to pause manufacturing of Car Thing,” Spotify’s device for connecting smartphones to car entertainment systems, in the most recent quarter.
In addition, Spotify expects total monthly active users to reach 450 million in Q3 and Premium subscribers to increase to 194 million. The company forecasted third-quarter revenue of €3.0 billion, with an operating loss of €218 million.
The firm had 4.4 million podcasts on the platform at the end of Q2. According to the company, the number of monthly users who listen to podcasts increased in the “substantial double digits” year over year. In Q2, Spotify released 100 new original and exclusive podcasts globally, including DC/Warner Bros.’ breakout hit “Batman Unburied,” which reached No. 1 in several markets.
Consequently, Swedish music streaming is expected to have 1 billion users worldwide by 2030, more than doubling its current number, according to company executives at its investor’s day event last month. It was also revealed that Spotify’s podcast business generated nearly €200 million in revenue in 2021, with a -57 percent negative gross margin. Follow TechGenyz for more updates.
