Spotify reaches 195 Million Paid Subscribers milestone
Spotify has published its financial results for the third quarter of 2022 and says it currently has 195 million paying subscribers, which represents a 13% increase in just one year.
From July to September, Spotify gained 23 million monthly active users to reach 456 million in total, including 195 million paid subscribers, 261 million use the service for free with advertising. The streaming service thus recorded a higher growth rate (20%) than in the previous three months (19%), the highest since the second quarter of 2021.
In detail, the increase in users occurred mainly in regions of the world outside the Americas and Europe, which now represent 26% of users, when that number was 11% four years ago. However, these are mostly users with the ad-supported free plan. The paying subscriber base has changed relatively little, with 88% arriving from the Americas and Europe, compared to 91% four years ago.
Spotify still sees the pace pick up in the fourth quarter and expects growth of 24%, with 479 million monthly active users at the end of 2022, including 202 million paying subscribers.
The turnover of the free part of the platform, which depends on advertising, thus recorded its weakest growth in the recent period, with 19% over a year, against 75% in the same period in 2021.
Turnover exceeded expectations, at 3.04 billion euros, an increase of 21% in just one year. Analysts had expected 3.02 billion euros. On the other hand, costs are increasing faster than revenues (+25%) due to hiring, investments, acquisitions and advertising spending, which is putting pressure on margins. Spotify still sees them fall apart in Q4. The group extended its net loss to 166 million euros from 160 million euros a year ago.
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