Spotify Q1 2019 Earnings
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The 20,000 Foot View: 2019 was a quarter of milestones for Spotify, hitting million subscribers, launching in India and becoming a podcast company. However, it was also a quarter in which a number of metrics started to soften. With the exception of ad revenue, none of these subtle shifts are enough on their own to provoke any serious concern. Collectively though, and contextualised against next quarter’s performance, these metrics may just prove to be early indicators of a potential change of pace.
- Spotify hit subscribers in 2019, a rise four million on 2018 and million from one year earlier
- Ad-supported monthly users (MAUs) were up seven from but this was fewer the million added one year
- Spotify’s paid rate dropped half a point however, this was up six from 2018
- Rest of ad-supported MAUs grew by around million in 2019 quarter-on-quarter, while grew by just million, diluting paid user ratio
- Spotify’s long-term average revenue per user (ARPU) slowed in 2019 with ARPU the lowest rate ever, down one cent from 2018
- Premium saw margin up to and revenue year-on-year (YoY) to billion, but revenue was up just YoY gross margin dropped to
- Spotify’s podcast are yet to have any impact on revenue but will a growing priority for Spotify, for its creator strategy
- Rightsholders are progressively less tolerant of family because of their dilutive impact ARPU
- Spotify will podcasts to start delivering revenue offset the impact lower ARPU emerging markets will have on revenue growth
- MIDiA forecasts to reach million subscribers by end of 2019 with million those in Europe, million in America, million in Latin America million in Rest of World
Companies and brands mentioned in this report: Anchor, Gimlet, Spotify, Warner Music