Audio streaming service Spotify has added 36 million monthly active users (MAUs) for the quarter ended June 30, 2023, posting its largest-ever quarterly net addition in the company's history.
Spotify said that its total user base rose by 27 percent year-on-year (YoY) to touch 551 million for the quarter, driven by strong growth across all regions and among Gen Z listeners, helped by improved retention and marketing efficiencies.
Spotify, which counts India among its top five markets in terms of the user base, however, didn't disclose specific information on its performance in the country in Q2 2023.
Paying subscribers grew by 17 percent YoY to 220 million subscribers, with outperformance results across all regions, led by Europe and Latin America. Spotify added 10 million subscribers during the quarter, its largest Q2 subscriber addition in the company's history. Promotional campaigns during the quarter contributed to this growth, the company said.
During the quarter, Spotify rolled out a redesigned desktop experience and added support for an additional 11 new languages for users around the world. The company also expanded its artificial intelligence (AI) DJ feature to Premium users in the United Kingdom and Ireland.
Earlier this week, Spotify also announced a price hike for its premium service in over 50 markets, including the United States, Canada, Australia, France, and the United Kingdom, among others.
The company now expects to reach 224 million subscribers and 572 million monthly active users in Q3 2023.
Financial performance:
Spotify's operating losses shot up to €247 million (around $272.5 million) during the quarter, from €194 million ($214 million) loss in the year-ago period. This was due to charges related to the shutdown of various podcast shows, severance, impairment of excess real estate, and higher personnel costs, partially offset by lower marketing and legal costs.
Total revenue was at €3.18 billion ($3.51 billion) for the quarter, up 11 percent year-on-year from €2.86 billion ($3.15 billion).
Revenue from subscriptions, which account for the majority of the company's revenue, grew by 11 percent YoY to €2.77 billion ($3.06 billion) for the quarter. The average revenue per user from the subscription business dipped by 6% to €4.27 ($4.71) for the quarter, impacted by product and market mix, the company said.
The company's advertising business grew 12 percent to €404 million ($445.7 million). The segment contributed about 12.7 percent of Spotify's revenues for the quarter. Podcast revenue grew by nearly 30 percent YoY, with "sold impressions across Original and Licensed podcasts and the Spotify Audience Network hitting an all-time high," the service said.
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