Spotify has released its earnings for the second quarter of 2019 and things are looking good.
In terms of subscribers, monthly active users increased by 29 percent year-on-year to 232 million while premium subscriptions climbed 31 percent to 108 million.
The firm says that this growth is largely thanks to a number of regions experience rapid take up of the streaming service. Spotify notes that the German and Japanese markets are performing better than expected.
“However, the most significant source of upside has been improvement in long-term retention due to our continued product innovation, particularly evident in our emerging geographies,” said Spotify in its earnings statement.
As for revenue, things are looking good in that department for this quarter as well.
Total earnings clocked in at €1.667 billion which represents a 31 percent year-on-year growth spurt.
Revenue from advertising grew 34 percent year-on-year to €165 million while revenue from premium subscriptions gained 31 percent year-on-year to earn Spotify €1.502 billion in Q2.
Where things get a bit hairy however is average revenue per user (ARPU). This figure dropped less than one percent to €4.86 but it was clearly a concern for stakeholders as Spotify mentioned it in its briefing.
“The declines in ARPU are a result of shifts in both product and geographic mix. Approximately 75% of the impact to ARPU is attributable to product mix changes, and the remainder a function of changes in geographic mix and other factors,” the firm explained.
As to the outlook for the rest of the year, podcasting appears to be a big area of growth for Spotify through until 2020.
It’s clear that there are still some struggles at Spotify but thankfully for it, folks are still flocking to the service. The company still has a ways to go as far as emerging markets are concerned but for now we’re sure the firm is celebrating a really good quarter.