Spotify adds 2 million paying subscribers in Q1 despite Russian Exit successes

Music streaming giant Spotify ended the first quarter with 182 million paid subscribers, up from 180 million at the end of 2021 but below its initial forecast of 183 million before leaving Russia, resulting in a loss of around 1,000. 5 million subscribers. .

The company also said Wednesday that it had reached 422 million monthly active customers (MAU) at the end of March, up from 406 million at the end of December and to that date.

“Our premium subscribers are up 15% year-on-year to 182 million,” the company said. “While this is slightly below our guidelines, after our departure from Russia ruled out an inadvertent reduction of around 1.5 million subscribers, growth has exceeded expectations and has been helped by successful performances in Latin America and Europe. . ”.

The company did not immediately specify any impact of the controversy surrounding podcaster Joe Rogan, which has led some to call for a boycott.

Spotify, led by CEO Daniel Eck, had previously forecast to end the quarter with 183 million paying subscribers and 418 million monthly active users, indicating that it would provide single estimates of key metrics rather than predicting a series of predictors. The The silent prediction came amid a growing list of musicians and podcasters protesting the company’s unique COVID-19 misinformation on Joe Rogan’s exclusive podcast. Joe Rogan’s ExperienceWhich led some users to cancel their subscriptions.

Rogan himself recently said that the media hype about guest anti-conspiracy theorists and his use of the N-word in the past has led to an additional 2 million subscribers “at the height of it all”.

Asking about the company’s fourth-quarter earnings, Eka said it was “too early to say” what kind of customer impact could be attributed to the cancellation of Rogan subscriptions. But the Spotify boss also noted that while Rogan “has a large audience,” he must also “follow” the music content giant’s content policy.

As for its impact on Russia, CFO Paul Vogel told an investor conference in March that Spotify tended to hit first-quarter subscribers before Russia invaded Ukraine, but the decision to suspend the company’s premium service in Russia would cause about 1.5 million paying users during that period. Later, Spotify “completely suspended” its services in Russia.

In the current second quarter, Spotify predicted on Wednesday that the total MAU would reach 428 million. This “reflects the loss as a result of the closure of Russian operations, as well as the complete reversal of the delay in service in March (these two items represent approximately 8 million 422 million MAUs posted in the first quarter),” the company said. . The benchmark is adding approximately 14 million new net MAUs per quarter.”

The total number of premium subscribers will reach 187 million by the end of the quarter, Spotify predicts. This “suggests an additional 600,000 closings after the full closure of Russian operations in April”, with the exception of Russia, its guidelines “imply to add about 6 million new net subscribers per quarter”, it said.

The Stockholm-based company’s first-quarter ad revenue grew by 31% and its podcast business also continued to expand. At the end of March, Spotify had 4.0 million podcasts on the platform, up from 3.6 million at the end of 2021. It has increased. The year is in double digits and the proportion of total hours spent on podcasts on our platform has reached an all-time high. The company also reported double-digit growth in “new podcasts in Latin America and the rest of the world.”

The company added: “Podcast revenue growth was driven by the Spotify Audience Network, with its growing Spotify Studios and our unique licensing agreements.”

First-quarter gross revenue increased by 24%, or 19%, straight to €2.66 billion ($2.82 billion). Spotify revenue increased from €23 million to €131 million ($139 million).