Spotify Technology Reports Mixed Results

Spotify Technology (SPOT) reported mixed results in the second quarter, with revenue ahead of analysts’ expectations while the streaming music company’s loss came in wider than expected as premium subscriber numbers were below the midpoint of its guidance range.

Revenue rose 31% to 1.67 billion euros ($1.86 billion), ahead of the consensus on Capital IQ for 1.64 billion euros. The loss narrowed to 0.42 euro a share in the period ended June 30 from 2.20 euros a year ago, but the Street view was for a loss of just 0.34 euro.

Monthly active users rose 29% year-on-year to 232 million, which Spotify said was above its guidance range of 222 million to 228 million. The company finished the second quarter with 108 million subscribers to its premium service, a 31% annual increase but below the midpoint of Spotify’s guidance range of 107 million to 110 million.

The mid-year campaign offering three months of premium for $0.99 was “largely in line with our expectations,” the company said, but intake into its student-focused product was “below plan.”

“As we have discussed previously, our goal is to perform at roughly the 70th percentile of our guidance range and we missed on subs. That’s on us,” the company said in a shareholder letter. “The good news is that the shortfall was execution related, rather than softness in the business, and we expect to make up the lost ground before year-end.”

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