Spotify Paid Subscriber Total Crawls to 182 Million as Quarterly Revenue Grows 24%

Spotify Paid Subscriber Total Crawls to 182 Million as Quarterly Revenue Grows 24%

Spotify added just 2 million premium subscribers in the first quarter of 2022 and wrapped up March with a total of 182 million paid users and 252 million ad-supported listeners, the company announced Wednesday morning in its latest earnings release. While that paid subscriber tally was a million under guidance, the company was quick to note that its wind-down in Russia, following its invasion of Ukraine, resulted in an “involuntary churn” of roughly 1.5 million subscribers there.

The company also placed a caveat on the 422 million total monthly active users (MAUs) it is reporting for the quarter ended March 31. Spotify believes that outperformance was due to a service outage that led to several million users creating new accounts to get back in — and that excluding that event, MAUs would have been 419 million.

First-quarter revenue was 2.66 billion euros ($2.96 billion), in line with guidance, representing 24% growth year-over-year but a 1% dip from Q4’s 2.69 billion euros. The vast majority of Q1 revenue came from subscriber income, which grew 23% y/y to 2.38 billion euros ($2.65 billion). Ad-supported revenue grew 31% y/y to 282 million euros ($314 million), but represented a significant drop compared to last quarter when it was 394 million euros ($445 million).

The closely-watched average revenue per user (ARPU) metric for premium subscribers was up 6% y/y to 4.38 euros ($4.9), which the company chalks up to a price increase in 2021 and a “favorable product mix shift.”

Spotify’s 1% drop in total revenue compared to the fourth quarter is a carbon copy of last year’s Q1 dip and in line with first quarter trends.

Gross margin, the remainder after royalties and other content associated, was 25.2% of total revenue, in line with previous quarters. The company cited a “favorable revenue mix shift towards podcasts and growing marketplace activity, which was offset by increased non-music content spend, investments in music product enhancements” and other factors.

Spotify reported an operating loss of 6 million euros ($6.6 million), down from 7 million euros in Q4 and 14 million euros profit in Q1 2021. Operating expenses totaled 677 million euros ($754 million) for the quarter, slightly higher than expected due to higher costs in personnel. On that topic, Spotify increased its full time employee count from 7,690 to 8,230 since its last earnings period.

Spotify said that its business has more than 3.6 billion euros ($4 billion) in liquidity and that its free cash flow was 22 million euros ($24.5 million), a 19 million decrease y/y.

As for non-music content, Spotify highlighted a 400,000 net gain in podcasts across the platform, to 4 million, compared to the end off 2021. The company noted that the podcast share of overall consumption hours across Spotify reached “another all-time high,” though the actual percentage was not disclosed.

This article will be updated. Check back for updates.

Spotify Paid Subscriber Total Crawls to 182 Million as Quarterly Revenue Grows 24% Spotify added just 2 million premium subscribers in the first quarter of 2022 and wrapped up March with a total of 182 million paid users and 252 million ad-supported listeners, the company announced Wednesday morning in its latest earnings release. While that paid…