Spotify grew its paid subscriber base by 32% in the first quarter of 2019.
Now, the streaming giant is home to 100 million Premium customers while the streaming-music company narrowed its losses and beat Wall Street’s expectations on the top line.
The company shares were up as much as 5% in premarket trading Monday on the results.
The company reported total Q1 revenue of $1.69 billion (€1.511 billion), topping analysts’ expectations of $1.64 billion. Spotify posted a net loss of $158 million (€142 million), versus a net loss of €169 million ($189 million) in the year-earlier period.
In the first quarter, Spotify’s total monthly active users grew 26% to 217 million, slightly lower than the midpoint of its guidance range. The company said it now has more than 2 million users in India, after launching in the country in late February where more than 1 million users signed up for Spotify in its first week in the market.
The streaming giant hit the top end of its guidance range for Premium subscriber additions, which company said was driven by “a better-than-planned promotion in the U.S. and Canada and continued strong growth in Family Plan.” It also said it saw strong growth from the expansion of its Google Home Mini promotion, and the effective price cut of its Spotify Premium-Hulu bundle offering in the U.S. to $9.99 monthly (vs. $12.99).
“Over time, our ambition is to develop a more robust advertising solution for podcasts that will allow us to layer in the kind of targeting, measurement, and reporting capabilities we have for the core ad-supported business,” Spotify said.
Ad-supported revenue grew 24% in Q1, to $141 million (€126 million) — which was short of Spotify’s expectations.
Q2 forecast for Spotify
For Q2 2019, company projected total MAUs of 222 million-228 million (up 23%-27%) and total premium subscribers of 107 million-110 million (up 29%-34%). It forecast total revenue of $1.69 billion-$1.91 billion (€1.51-€1.71 billion, up 18%-35%) and an operating loss of $16.7 million-$106 million (-€15 million to -€95 million).
The shortfall was primarily in the U.S. and related to its pricing of sponsored sessions-video product, according to the company. “We have course-corrected and are seeing strong growth across the ads business in Q2,” Spotify said in announcing earnings.