Spotify dancing on air as premium subscribers revenue beats expectations
All those weekend nights in as coronavirus restrictions increased seem to have helped Spotify added more premium subscribers in the third quarter than expected.
The music streaming service forecast strong growth in the current quarter as more users signed on for an ad-free experience.
With more than double the number of subscribers than its nearest rival Apple Music, Spotify has been expanding rapidly in markets across Europe after launching in India and the Middle East last year.
Premium subscribers, which account for most of its revenue, were up 27% to 144 million from a year earlier.
That’s ahead of the 142.5m paid subscribers analysts had pencilled in.
Expanding East
Spotify credited the rise in subscribers to its recent launch in new markets such as Russia, which it deemed the “most successful new market launch” to date.
The company expects total premium subscribers in the range of 150m to 154m for the fourth quarter. Analysts were expecting it to hit 151.5 million.
Spotify, which also plays ads to users listening for free, saw its advertising business return back to growth after the global pandemic hit ad growth earlier in the year.
Revenue rose 14% to €1.98bn (£1.79bn) in the quarter, this time missing expectations of €2bn.
Excluding the impact of foreign exchange, Spotify said its quarterly revenue was “slightly better than expected.”