Spotify subscriber numbers grew significantly in the second quarter of the year, says the company, citing big growth in both free and paying users …
The company reported “a very strong quarter” as revenue and subscriber numbers both exceeded its own guidance for the quarter.
Paying subscribers grew 27% year-on-year to 220M, and monthly active users increased 17% to 551M. The company also highlighted an 11% growth in revenue to €3.2B ($3.5B).
All the same, the company is still losing money, and The Verge notes that its losses more than doubled year-on-year.
The company made a net loss of €302 million (around $333 million) this quarter, versus a loss of €125 million (around $138.5 million) in the same quarter last year.
While Spotify insists it prioritizes growth over profit, there’s no sign that the company has a clear plan for ever achieving profitability.
Streaming music is a very tough business to be in, with the bulk of the subscription revenue going straight to music labels, and the little remaining balance being eaten up in operating and marketing costs. A price rise may help a little, but likely not enough.
Spotify has also been left behind by Apple Music and others in terms of lossless music and spatial audio.
While the iPhone maker likely also makes no money from its streaming music service, that’s not a problem: Apple Music is simply another part of the ecosystem that drives hardware sales. Spotify, in contrast, has no revenue stream beyond subscriptions and ads, neither of which pays the bills.
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