Spotify Technology SA (NYSE:SPOT) reported fiscal first-quarter 2024 revenue growth of 20% year-on-year to €3.64 billion ($3.95 billion), beating the consensus of $3.85 billion. EPS of €0.97 ($1.05) beat the consensus of $0.70.
Premium Revenue grew 20% year over year to €3.25 billion, helped by subscriber additions and ARPU increases.
Total MAUs (Monthly Active Users) rose 19% Y/Y to 615 million , which missed its guidance by 3 million. A "moderated marketing activity" led to "more normalized growth" following 2023's record performance, the Variety cites Spotify.
The lower-than-expected MAU growth also came amid "organizational change," referring to Spotify's December 2023 layoffs when the company slashed 17% of its workforce.
Ad-supported MAUs grew 22% Y/Y to 388 million. Premium Subscribers grew 14% Y/Y to 239 million.
Within Premium, the average revenue per user (ARPU) rose by 5% year over year to €4.55. Ad-supported revenue rose 18% to €389 million.
Margins: The gross margin improved by 243 bps to 27.6%, reflecting improved podcast and music profitability. The Premium gross margin was 30.2%, up 155 bps Y/Y, reflecting Marketplace growth.
The ad-supported gross margin was 6.4%, which is up 947 bps Y/Y, reflecting an improvement in podcast and music profitability. Operating income improved to a new quarterly high of €168 million with a margin of 4.6%.
Spotify held €4.7 billion in cash and equivalents and generated €207 million in free cash flow.
Outlook: Spotify expects second-quarter revenue of €3.8 billion (consensus $3.76 billion) and total MAUs of 631 million.
Spotify stock gained over 107% in the last 12 months. Investors can gain exposure to the stock via Global X Social Media ETF (NASDAQ:SOCL) and ProShares On-Demand ETF (NYSE:OND).
Price action: SPOT shares traded higher by 8.27% at $294.75 premarket at the last check Tuesday.
Photo courtesy: Spotify
Comments