As a seasoned gamer and long-time Spotify user, I can’t help but feel like Daniel Ek just leveled up his game mastery to epic proportions! With over 640 million monthly active users and 252 million paid subscribers, it feels like the entire gaming world has tuned in to the Spotify platform.
In the third quarter, Spotify saw a 11% rise in monthly active users compared to the same period last year, amounting to a whopping 640 million users. Meanwhile, the total number of paid subscribers grew by 12%, hitting 252 million. Interestingly, both figures surpassed the company’s forecast by a significant margin of 1 million.
The total earnings increased by 19% to hit €4 billion, meeting the projected targets. The operating income soared to €454 million, primarily due to a robust gross margin and decreased expenses in personnel and marketing sectors, setting a new record for the company. This places Spotify on the path towards achieving its first year of profitability in terms of operational income.
The total operating income was affected by €54 million in excess social charges, which are essentially payroll taxes related to employees’ salaries and benefits. This surplus arose because the company’s share price increased more than anticipated during the quarter, resulting in €39 million more being accrued compared to the initial forecast.
The main factor boosting our revenue was a 21% rise in premium or subscription income, fueled by an increase in subscribers and higher average revenues per user (ARPU), due to a price hike for premium accounts starting June. Meanwhile, ad-supported accounts experienced a 6% yearly growth. Spotify mentioned a tough marketing climate and soft pricing in music and podcast advertising as reasons for this growth.
At the end of Q3, the Spotify workforce consisted of 7,242 full-time employees globally.
Daniel Ek, Spotify’s Founder & CEO, expressed his satisfaction saying, “Our team’s exceptional performance has put us in an unparalleled position. I’m immensely proud of our achievements and advancements.” He added, “We’ve reached, if not surpassed, our intended destination, and we’re steadily marching towards our long-term objectives. Our unwavering dedication to innovation and growth sets us apart, promising the best user experience in the market, while preserving the distinctive qualities that define Spotify.” He is eagerly looking forward to what the future holds for Spotify.
More to come.
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2024-11-13 00:54