Mike Peterson
Spotify bled about $118 million in profit in the third quarter of 2020, despite its active monthly user count increasing 29% during the period.
The chief Apple Music competitor now has 320 million monthly active users and 144 million paid subscribers. Spotify attributed the growth in both of those sections to marketing in India and a launch in Russia and 12 other markets.
Despite reporting revenue growth of 14% to about $2.32 billion, the streaming service still reported a loss of $118 million. In the third quarter of 2019, the company actually made a profit of $282 million.
In the year-ago quarter, Spotify had 248 million monthly active users and 113 paid subscribers. Year-over-year, Spotify revenue per-user dropped about 10%. Largely, that's due to the fact that the service is luring in new subscribers with discounted plans.
Several months after securing an exclusive deal with "The Joe Rogan Experience," Spotify says that the podcast is now the platform's most popular. There are about 1.9 million podcasts available on the streaming now, up from $1.5 million quarter-over-quarter. More users appear to be engaging with podcasts, too, representing about a 1% increase from Q2 2020.
Apple Music, for its part, reported that it had 60 million paying subscribers as of last year. The Apple music service does not have a free tier, and while it doesn't offer subscriber counts as frequently as Spotify, some light could be shed on its performance on Apple's Thursday earnings call.
Andrew Orr
Amber Neely
William Gallagher
Christine McKee
AppleInsider Staff
14 Comments
Remind me, what's Spotify?
At some point a company that actually makes money is going to have to buy Spotify. But will the antitrust types go for it?
AT&T, Disney, Viacom and Comcast won't bite. They are too busy paying off debts from their Time Warner, Fox, Paramount and Universal purchases. For Disney and AT&T in particular it looks really bad. Disney's debt load is massive and while AT&T's debt is smaller, they don't have anything like Disney+ to pay it off.
Were Netflix to buy Spotify, I guess that would be fine as Google, Amazon and Apple all own video and music streaming services (YouTube, YouTube TV, Google TV, YouTube Music; Prime Video, Prime Music; Apple TV+, Apple Music plus whatever they split iTunes up into).
But were Google, Amazon or Apple to buy Spotify, the antitrust regulators would freak out. This isn't the same environment that allowed Google to buy Songza, Apple to buy Beats etc. a few years back.
Maybe Sirius XM can buy it and merge it with Pandora? That would probably be the best outcome. Spotify does need to continue to exist in some form. And while that combination would have a huge market share, Google, Apple and Amazon still have their streaming music offerings so it would be far from a monopoly.
I'm surprised they didn't blame Apple for their $118 million dollar loss.
Isn't this the company whining that Apple's inventions are too successful?
Yeah this isn't about money at all but the poor little developer they don't give a damn about.