Spotify narrows Q1 losses by 16% and reaches 100m paid subscribers

Net losses reduced by 16% compared to the $189m of red ink that the company reported for the same period a year earlier.

Revenue meanwhile rose 33% to $1.69bn, beating analysts’ estimates of $1.63bn, according to data from IBES Refinitiv.

Spotify said it had 217m monthly active users (MAUs) at the end of March, versus 173m in the same quarter a year earlier.

Analysts on average were expecting the company to have 218.6m subscribers, according to FactSet estimates.

Management also revealed that the company had managed to reach over 100m paid subscribers, for growth of 26% from 75m a year earlier. This metric was also ahead of analysts' estimates for 99m paid subscribers.

The company credited its work with Google home assistants for part of the rise in paid subscribers, saying: "We believe that smart loudspeakers are a critical area of growth, especially for music and podcasts, so we intend to continue looking for opportunities to expand our presence in this area.”

Costs climbed by 32.9% compared to a year ago because of the copyright fees that Spotify is obliged to pay to artists and record companies.

CEO Daniel Ek said on the earnings call Monday regarding the status of Spotify’s anti-competition complaint against Apple filed in March with the European Union: “We cannot yet say what the response will be.”

But he added “What I can say personally from speaking to lots of regulators [is that] this is the moment when these issues need to be debated.”