Spotify Technology SA missed quarterly revenue expectations on Wednesday and forecast a soft current quarter, due mainly to a decline in ads as the COVID-19 pandemic kept advertisers at bay.
While monthly active users rose 29% to 299 million, ad-supported revenue fell 21% in the second quarter.
However, the company said it expected to hit its full-year financial targets, assuaging investor concerns that a drop in commuting in the pandemic might hit streaming services. “User trends remain strong on a headline number basis, but mix shift to lower price tiers and geographies continues to weigh on subscription average revenue per user, leaving subscription revenues below where some investors had hoped,” said Evercore ISI analyst Kevin Rippey.Spotify forecast total revenue of 1.85-2.05 billion euros for the third quarter. Analysts were expecting 2.01 billion euros.
The net loss attributable to Spotify was 356 million euros, or 1.91 euros per share, compared with 76 million or 42 euro cents a year earlier. Analysts were expecting a loss of 45 euro cents.
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