Spotify on Thursday added more subscribers in the third quarter than Wall Street had expected and forecast strong growth in the current quarter as more users tuned in to its streaming music service.
With more than double the number of subscribers than its nearest rival Apple Music, Spotify has been expanding rapidly in markets across Europe after launching in India and the Middle East last year.
Premium subscribers, which account for most of its revenue, were up 27 percent to 144 million from a year earlier. Analysts on average were expecting the company to have 142.5 million paid subscribers, according to IBES data from Refinitiv. Total monthly active users rose 29 percent to 320 million.
The company expects total premium subscribers in the range of 150 million to 154 million for the fourth quarter. Analysts were expecting it to hit 151.5 million.
Spotify credited the rise in subscribers to its recent launch in new markets such as Russia, which it deemed the “most successful new market launch” to date.
The company, which earns from paid subscriptions and by showing ads to non-paying users, saw its advertising business return back to growth after the global pandemic hurt ad growth earlier in the year.
Revenue rose 14 percent to EUR 1.98 billion (roughly Rs. 17,268 crores) in the quarter. Analysts were expecting revenue of EUR 2 billion (roughly Rs. 17,442 crores), according to IBES data from Refinitiv.
Excluding the impact of foreign exchange, Spotify said its quarterly revenue was “slightly better than expected”.
© Thomson Reuters 2020
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