Spotify Technology SA’s number of active users has topped half billion for the first time on Tuesday, this increase sent the company’s shares up by five percent, after its expansion into more markets.
The number of active users reached 515 million in the first quarter, beating the company’s guidance and analysts’ forecast of 500 million according to IBES data. Premium subscribers rose by 15 percent to 210 million, counting for most of its revenues.
Spotify has been planning on reaching one billion users by 2030 and $100 billion in annual revenue. The company also promised high-margin returns from its costly expansion into podcasts and audiobooks.
“Spotify is not sort of one silver bullet, but it’s rather 100 or 1,000 things that we are doing that sort of compounds and adds to the story,” CEO Daniel Ek told Reuters.
According to Reuters, the company’s quarterly revenues of $3.35 billion did not meet the analyst estimates of $3.38 billion. “There’s still a kind of a lot of macro choppiness in Q1 so that impacts us a little bit,” said EK.
The majority of subscribers do not subscribe right away, since they usually have free trials or are a part of a family plan. According to EK this is why Spotify does not get revenues right away.
Spotify’s current-quarter revenue forecast of €3.2 billion missed expectations of €3.26 billion as well.
