STOCKHOLM, Sweden (CelebrityAccess) — On Tuesday, music streaming service Spotify announced their financial results for the first fiscal quarter of 2023, with monthly active users topping half a billion for the first time.
Spotify reported revenue growth of 14% year-over-year to €3.0 billion, which the company attributed to subscriber growth, both in their premium and ad-supported tiers.
Gross Margin finished at 25.2%, reflecting improved music and podcast profitability but the company still lost money during the quarter, reporting an operating loss of €156 million during the first quarter of 2023.
According to Spotify, the company grew their user base substantially during the first quarter, with premium subscribers up by 15% year-over-year to 210 million, with outperformance across all regions, led by Europe and Latin America.
“As you’ve heard me say repeatedly over the years, a healthy topline user growth is the leading indicator of our ability to achieve future success on all other financial metrics. And when we successfully attract new users, it’s only a matter of time before the conversion rate to subscribers increases, which then of course drives our revenue upwards over the long term. It’s a formula that has worked for us exceptionally well and one I fully expect to play out again,” Spotify CEO Daniel Ek said in a conference call with investors discussing the earnings release.
