Spotify monthly active users grew by 26 million during the first quarter this year to bring the total number of users on the world’s most popular audio streaming platform to more than half a billion, the company reported on Tuesday.
Total revenues rose 14% to 3 billion euros ($3.3 billion USD), slightly lower than company guidance as fears of a slowing economy hurt Spotify’s advertising business, but lower marketing costs improved the company’s operating losses and gross margin held flat from last year, the company said.
But the 22% year-over-year uptick in MAUs, bringing that figure to 515 million, beat Spotify’s earlier guidance and was helped by higher renewals than the company predicted. Premium subscribers rose by 15% to 210 million, compared to 182 million a year ago (and 205 million last quarter), and ad-supported users rose 26% to 317 million from 252 million a year ago (and 295 million last quarter).
“Revenue growth was slightly below our expectations due to macro-related variability in our advertising business,” the company said in a statement. “The operating loss was also better, aided by lower marketing spend. Overall, we are encouraged by the strong start to 2023.”
Spotify chief executive Daniel Ek will discuss the company’s earnings in greater detail on a conference call starting at 8 a.m. eastern time.
Until then, here are some of the highlights:
- Spotify reported total revenue of 3 billion euros ($3.3 USD), up 14% from the year ago quarter.
- Monthly active users (MAUs) were up 22% to 515 million this quarter versus the year ago quarter, including a net addition of 26 million new users.
- Premium subscribers grew by 15% to 210 million this quarter compared to the year ago quarter.
- Gross margin of 25.2% held flat from a year ago.
- The company reported operating loss of 38 million euros ($41.9 million USD), and free cash flow of 57 million euros ($62.9 million USD).
