Spotify Q2 2021 earnings Slowdown arrives
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The 20,000 Foot View: The growth headwinds that appeared in 2021 manifested in a pronounced user growth slowdown in with ad-supported users hit hardest. Spotify has been through lean growth periods before, but what is different this time is that streaming’s new players are growing at pace. Slowing down as your competitors accelerate is never a good thing. The net result is that the labels’ dependency on Spotify is beginning to lessen.
Key Insights
- User growth slowed: Spotify added nine million monthly active users (MAUs) in 2021 to reach million MAUs, compared to million in 2021 and million in 2020
- Spotify’s podcast user base growth has slowed also, growing largely in line with the over MAU base since 2020
- Subscriber growth fared better, adding seven million to reach million, following net additions of just three million the previous quarter
- Europe saw the largest number of net subscriber additions: million quarter-on-quarter (QoQ), million year-on-year (YoY)
- Latin America subscriber numbers only recovered to 2020 levels million) with annual growth slowing markedly compared to 2020
- Rest of World quarterly subscriber additions were under one million, compared to nearly two million in 2021 and a little over one million in 2020
- Revenue growth was more positive, reflecting improving monetization. Total revenue was up million on a quarterly basis and ad revenue was up million, compared to a decline of million in 2020
- The major labels had a strong 2021, registering streaming revenue growth on 2020 to reach billion. Spotify’s streaming revenue growth was
- Spotify’s share of streaming revenue growth fell from in 2017 to just in 2021
Companies and brands mentioned in this report: Amazon Music, Audiomack, Clubhouse, Facebook, Greenroom, Instagram, Peloton, Shorts, Soundcloud, TikTok, WMG, YouTube