The numbers mostly beat expectations, but projections for user growth in Q1 were barely in line with analysts’ projections. There was also a broader selloff in tech shares after the bell, after Facebook (Meta) reported disappointing earnings.
Here are the key numbers:
Loss per share: EUR0.21 vs EUR0.43 expected, per Refinitiv
Revenue: EUR2.69 billion vs EUR2.65 billion expected by Refinitiv
The streaming company posted 406 million monthly active users in the quarter, up from 381 million. That’s in line with its guidance of 400 million to 407 million and slightly beat analyst expectations, per StreetAccount. Spotify’s premium, or paid, subscribers grew 16% year over year to 180 million in the quarter, the company said. Spotify cited strong promotional campaign performance.
In the first quarter of 2022, Spotify expects to report 418 million monthly active users. Analysts anticipated guidance of 417.8 million, according to StreetAccount. It expects to report 183 million total premium subscribers.
The company added that “since the vast majority of our initiatives are multi-year in nature and measured as such, we no longer plan to issue annual guidance.” For quarterly guidance, the company said it would provide a “single estimate for each metric instead of a range of outcomes.”
The company’s ad-supported revenue benefitted from strong demand. Spotify said that ad-supported revenue reached a record 15% of total revenues in the quarter.
Spotify reported a double digit increase in the number of monthly active users that engaged with podcasts in the quarter.
CEO Daniel Ek opened up the company’s call with investors by addressing the ongoing controversy over podcaster Joe Rogan in its report, which has led musicians to pull their music from the platform. Rogan has been accused by medical professionals that he has repeatedly spread conspiracy theories about Covid-19 on his show. Spotify, meanwhile, has been under fire for hosting the episodes. It bought the exclusive streaming rights to “The Joe Rogan Experience” in a deal reportedly worth more than $100 million.
The efforts have caused Spotify to add content advisories to any material mentioning Covid-19. It will also direct its users to public health sites for more information. But Ek said there’s still room to grow.
“There’s still work to be done,” Ek said.
Podcasts have been a key growth area for Spotify. At the end of the quarter, it had 3.6 million podcasts on the platform, compared to 3.2 million the quarter prior. Podcast share of overall consumption hours on Spotify also reached an all-time high.