Spotify Reports It Has Reached 10 Crores Paid Subscribers

On April 29, the renowned streaming platform Spotify reported that it had reached 10 crores paid subscribers which were allegedly beyond the company’s expectation towards the revenue in the first quarter of 2019.

The amount of users of the digital music service is two times as many as that of Apple Music, its biggest rival. Up to now, Spotify has been available in many places such as the Middle East, North Africa, and India. It is looking for efficient solutions to promote its development while its price has kept rising.

The quarterly results showed that Spotify’s rivals couldn’t beat it at that moment. At the beginning of April, Apple’s music service with 28 million paid subscribers in the U.S. market surpassed Spotify’s one with 26 million paid subscribers. In addition, Amazon has just added a free music tier that supports advertisement to its existing service.

After the results were released, the Spotify CEO Daniel Ek stated, “Competition is just not a big factor for us, it’s really all about growth.” He further said that considering users and revenue, the company hoped to “keep on growing at more than 30 percent per year”.

Spotify’s shares remained at $138.30.

Its growth in the first quarter seemed to indicate better results compared to what a few analysts had evaluated relating to average revenue per active user. The growth rate was said to be equivalent to that of the same period 2018 when Spotify expanded to markets with lower prices and had to look for new subscribers by promotions.

According to the analyst of Atlantic Equities James Cordwell,

In March 2019, the platform attracted 217 million active users per month, 44 million higher than the number of active users in the same quarter of 2018. According to FactSet, many analysts stated that Spotify could reach 218.6 million subscribers.

The amount of paying subscribers during the first quarter of 2019 hit 100 million, increasing by 25 million over the 2018 figure. Based on Refinitiv’s IBES data, at first, analysts forecast the company’s estimated revenue to reach 1.47 billion euros. However, the revenue, in fact, hit 1.51 billion euros, increasing by 33%.

In percentage, Spotify had 40% of the paid subscribers in Europe, and 30% in North America.

The company also hopes that it will reach approximately 107-110 million premium subscribers before the second quarter of 2019 ends, and 117-127 millions of subcribers before the year 2019 goes by.

In addition, its total revenue is expected to increase to 1.71 billion euros from 1.51 billion euros in Quarter 2, and to 6.8 billion euros from 6.35 billion euros this year.

According to Spotify, the company has bought two podcast companies including Anchor FM and Gimlet Media for 308 million euros and bought Parcast’s parent company called Cutler Media LLC for 50 million euros.