Spotify Technology, the world's largest audio-streaming service, gave some hints of improving trends in advertising sales and music listening with its second-quarter results.
The Swedish company said advertising revenue fell 25 per cent in the quarter compared to the same period in 2019, as the world reeled from the coronavirus pandemic. However, most of the trouble was in April and May, with June down just 12 per cent, suggesting the ad slump is abating.
Growth in the key metric of monthly active users exceeded Spotify's expectations in North America, where music listening started to rise again in May and is back at pre-Covid levels, according to Billboard.
Listening declined as commuting and travel dried up amid lockdowns.
While Spotify saw lower-than-expected growth in its “Latin America and rest of world” segment in April and May, “encouragingly, things rebounded significantly in June”, it said, noting increased reactivations and lower churn.
Overall second-quarter revenue and average revenue per user missed analysts’ expectations, and Spotify shares slid 4.7 per cent to $254.50 in US pre-market trading.
The stock has surged 79 per cent this year as it makes a push on podcasts, amassing exclusive deals with Joe Rogan, Michelle Obama and Kim Kardashian. Spotify plans to offer all the shows free, using them as a tool to attract new listeners and advertisers. – Bloomberg
