Spotify Misses Overall Q2 User Target, Ad Revenue Jumps 110%

Spotify Misses Overall Q2 User Target, Ad Revenue Jumps 110%

7/28/2021 1:20:00 PM

Spotify Misses Overall Q2 User Target, Ad Revenue Jumps 110%

Spotify, citing ongoing headwinds from the COVID pandemic, fell short of its total monthly user growth goal in the second quarter of 2021. The audio-streaming giant netted 7 million paying subscrib…

The company’s previous Q2 guidance was overall monthly users of 366 million-373 million and 162 million-166 million paying subscribers.“While MAU growth was softer than expected in the first half of the year, we are seeing that trendline reverse and all the leading indicators show that we are back on track,” Spotify CEO and founder Daniel Ek said in announcing results. “By accelerating our pace of innovation and investing for the long term, we continue to cement our standing as the preferred audio platform around the world.”

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In discussing the lighter user adds in the quarter, Spotify said in its letter to shareholders, “COVID-19 continued to weigh on our performance in several markets, and, in some instances, we paused marketing campaigns due to the severity of the pandemic.”

Revenue of €2,331 million was up 23% year over year, due to “significant advertising strength and subscriber outperformance.” Spotify Premium revenue grew 17% to €2,056 million and ad-supported revenue was particularly strong, growing 110% Y/Y to €275 million (or 126% Y/Y constant currency). headtopics.com

At the end of Q2, Spotify had 2.9 million podcasts on the platform, up from 2.6 million at the end of Q1. The percentage of MAUs that engaged with podcast content on our platform improved modestly relative to Q1 (when about 25% of total users listened to podcasts), the company said.

Among MAUs that engaged with podcasts in Q2, consumption trends were strong (up 95% Y/Y in aggregate and more than 30% Y/Y on a per user basis) while week-over-week and month-over-month retention rates reached all-time highs. During the quarter, podcast share of overall consumption hours on Spotify also reached an all-time high.

Spotify said the growth in ad-supported revenue was led by Direct and Podcast sales channels, with the latter benefiting from a triple-digit Y/Y gain at existing Spotify studios (The Ringer, Parcast, Spotify Studios, and Gimlet) along with contributions from the Megaphone acquisition, the exclusive licensing of the Joe Rogan Experience, and the Obamas’ Higher Ground.

During the quarter, the company announced exclusive licensing deals with Call Her Daddy and Dax Shepard’s Armchair Expert, both of which are now exclusively on Spotify. The Joe Rogan Experience continues to perform above expectations, and The Ringer shows, such as The Bill Simmons Podcast, grew consumption significantly as the NBA headed into the playoffs. headtopics.com

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Spotify also called out Olivia Rodrigo’s new album, “Sour,” which in May set the record for biggest streaming debut for any album on Spotify so far in 2021 with more than 63 million global first-day streams. Read more: Variety »

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they paid Harry & Meghan $25M for a 35 minute podcast, they woke now I had Spotify for the free 14 day trial and then immediately had to delete it! I'll happily stick to ripping my CDs on to a memory stick thanks. Don't support companies that censor.

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