Spotify by the Numbers: Trials, Churn and Margin

The 20,000 Foot View: This report presents analysis of Spotify’s key performance metrics as presented in the F1 filing in advance of its direct listing. The report focuses on business performance metrics, such as user acquisition and retention, user engagement and user spend. In addition to the headline numbers, this report includes detailed supplementary data analysis to create further implied datasets that were not reported in the filing.

Key Findings

  • Global subscribers grew by X million in quarters without ‘super trials’ and X million in the quarters with them
  • Engagement is growing; subscribers played an average of X streams a month in 2017, compared to X in 2015
  • Inactive subscribers grew from X million in Q1 2016 to X million in Q4 2017
  • On an annual basis churn was X% in 2017, down from X% in 2016
  • Lost subscribers totalled X million in 2017, up from X million one year earlier
  • Spotify is growing subscribers faster than free users in all regions except X
  • Spotify had to gain X extra subscriber for every additional X subscribers it held onto in 2016. In 2017 this rose slightly to X
  • European and North American subscribers each grew by X million and X million respectively with trials
  • Super trials enable Spotify to grow X months faster than it would without them
  • Quarterly churn increased by an average of X% in super trial quarters
  • Gross profit per subscriber was €X ($0.X) higher in the quarters with rights payments for super trials
  • It took an average of X months to recoup acquisition costs per subscriber in 2016, rising to X months in 2017
  • Spotify should reach X million subscribers by Q4 2018, by comparison, Apple Music is likely to have hit around X million over the same period

Companies and brands mentioned in this report: Amazon, Apple, Apple Music, Deezer, Spotify

Charts: 7
Pages: 16
Words: 3,116

Includes Synopsis, PDF, Slides and Dataset