Spotify’s total number of monthly listeners reached 406 million at the end of the last year, the global music streaming service said Wednesday, crossing the 400 million milestone to reiterate its dominance of streaming music services worldwide.
That was weeks before hashtags like #CancelSpotify started trending, sparked by artists’ protests over COVID misinformation on Joe Rogan’s popular podcast.
Spotify’s monthly active users beat the consensus expectation of Wall Street analysts, and the number was at the top end of the company’s guidance for its fourth quarter. But Spotify projected a slower-than-expected start to this year, without giving much indication as to why — and its share price cratered in after-hours trading Wednesday, down 13% to $168.02.
Looking ahead to the close of its first-quarter, Spotify projected it would reach 418 million monthly listeners and 183 million paid subscribers — shy of the 420 million listeners and 184 million members that analysts expected, according to Refinitiv Eikon.
By the end of last year, Spotify’s paid members — which excludes all the people who listen free with advertising — rose to 180 million, up 16% from a year earlier. Spotify makes more money from its paying subscribers than the ones who listen free with ads. Over the last year and a half, the COVID-19 pandemic caused lumpiness in Spotify’s growth, as people’s interest in listening to music on the go waxed and waned depending on whether they could actually go anywhere.
Spotify has been in the spotlight in the last week as singer-songwriter Neil Young triggered a debate about the service’s role in moderating the messages promoted on its service, as he pulled his music from Spotify over objections to COVID-19 vaccine misinformation on Rogan’s podcast. Young’s boycott came after hundreds of medical professions pointed to Rogan as they called on Spotify to tackle COVID misinformation more aggressively. Folk icon Joni Mitchell joined in Young’s boycott Saturday.
Still, the latest figures reiterate Spotify’s dominance in subscription music around the world. Its No. 2 competitor, Apple Music, doesn’t routinely disclose its paid membership and hasn’t offered an update in more than two years, obscuring just how much of a lead Spotify may have. Apple Music last disclosed the size of its subscriber base in June 2019, when it had 60 million members, though it has surely grown in the intervening years. (According to music industry researcher Midia last year, Apple holds about 16% of the world’s subscription music market, and Spotify’s share is double that.)
For the fourth quarter, Sweden-based Spotify reported a loss of 39 million euros ($44 million at current exchange rates), or 21 cents a share, narrowing from a loss of 125 million euros, or 21 cents a share, a year earlier. Revenue rose 24% to 2.69 billion euros in the quarter.
Analysts on average had expected a loss of 43 cents in the latest period, on revenue of 2.65 billion euros, according to Refinitiv Eikon.
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