In the fourth quarter, premium subscribers rose 11 per cent to 263 million, compared with Visible Alpha estimates of 260 million.
SPOTIFY forecast first-quarter profit above market estimates on Tuesday (Feb 4) as the Swedish audio-streaming giant benefits from steady user growth, price hikes and a cost-cutting drive.
Spotify expects operating income of 548 million euros (S$767.6 million) in the current quarter, above analysts’ average estimate of 450.6 million euros, according to data compiled by LSEG.
It increased prices for its service in June last year and has kept a tight lid on costs including marketing efforts to boost margins.
At the same time, its focus on music and podcast video offerings has helped attract users, analysts have said. Spotify has extended a test rollout of its music videos to new markets and unveiled new features that help improve user-engagement for content creators in certain markets.
The company forecast monthly active users (MAUs) of 678 million in the first quarter, in line with estimates of 679.4 million. It expects to add about two million premium subscribers, which would take the total to 265 million, above Visible Alpha estimates of 263.2 million.
In the fourth quarter, premium subscribers rose 11 per cent to 263 million, compared with Visible Alpha estimates of 260 million. MAUs rose 12 per cent to 675 million and exceeded expectations.
Fourth-quarter revenue rose 16 per cent to 4.24 billion euros, beating estimates of 4.19 billion euros, driven by subscriber gains and increasing average revenue per user.
Gross profit jumped 40 per cent to 1.37 billion euros, compared with estimates of 1.32 billion euros. Gross profit margin increased to 32.2 per cent from 31.1 per cent in the prior quarter.
The company expects first-quarter revenue of 4.2 billion euros, slightly above estimates of 4.17 billion euros. REUTERS
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