Spotify
reported strong fourth-quarter performance, surpassing anticipated monthly active users and subscribers across regions. This came as company implemented price hikes for subscribers and staff layoffs to enhance profits.
The company, however, is also hopeful of positive revenue and profitability trends this year. Diversifying into podcasts and audiobooks, Spotify aims to expand its user base to 1 billion by 2030.
Spotify monthly active users increased
Spotify said that its monthly active users increased by 23% to 602 million.
Premium subscribers, the main revenue source, grew by 15% to 236 million. Despite a 16% revenue rise to 3.67 billion euros, it fell short due to foreign exchange losses, impacting first-quarter revenue expectations.
Spotify CEO
Daniel Ek emphasised on utilising various strategies, including price adjustments, to enhance profitability. Spotify's focus has shifted towards bottom-line growth.
"We have plenty of levers to pull, including price increases, so you will see us work with all of these levers at various times and in various markets. We are now a lot more focused on the bottom line as well,” news agency Reuters quoted Ek as saying.
Spotify has also invested heavily in its podcast business, including signing hosts such as
Joe Rogan
, and podcast advertising grew by double digits in the quarter.
The company forecasts 239 million premium subscribers for the current quarter, surpassing estimates. However, the first-quarter outlook falls below Wall Street's expectations for total users and revenue.
Spotify anticipates 618 million monthly users this quarter, slightly lower than estimates of 618.8 million. It expects operating income of 180 million euros in the current quarter after posted a fourth-quarter operating loss of 75 million euros.
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