Spotify just reported its quarterly earnings for the second quarter, it did post a loss for the quarter, which was larger than analysts were expecting. But Spotify did also put up some pretty big numbers for monthly active users as well as premium subscribers. Which is why the stock is hitting all-time highs in trading today. For the quarter, the company had €1.27 billion in revenue (around $1.49 billion USD), and that was up 26-percent year-over-year, which was in-line with estimates. On the EPS line, it had a loss of €2.20 per share, which was much lower than estimates of €0.68 per share. Spotify also had a net loss of €394 million and an operating loss of €91 million.
Now the good news for Spotify was that it is still growing. It’s monthly active users or MAUs, grew 30-percent year-over-year, bringing the total to 180 million by the end of the quarter. Spotify noted that it had most of its growth in its emerging regions, including Latin America and Rest of World, which is still beating out the growth in its more established markets like the US. Now Ad-supported monthly active users were 101 million, which is up 23-percent from the same period a year ago. Spotify attributes this to the redesign of its interface for ad-supported members, and expect that the interface will continue to bring in more engagement, retention and conversion. For premium members, Spotify saw a 40-percent increase to 83 million for the quarter. These are members that are paying $9.99 per month for the service. Spotify says that it did also extend its promotion with Hulu, where you can get Spotify and Hulu for $12.99 per month in the US.
Spotify, despite still growing, is still far from being a profitable company. That is usually the case for the first few years that a company goes public though. Typically companies go public to raise more capital to be able to become profitable. But for Spotify, there’s a lot more competition – from Apple, Amazon and Google – not to mention the royalties that must be paid for music that is paid. Which makes the profit margin very slim in the first place, but it is still the largest streaming music platform out there.