Music Business

Spotify Q2 2021 report sends mixed signals

[UDATE 4] Spotify shared Q2 2021 user and financial stats on Wednesday morning which generally met analysts’ expectations.

But investors expected more and drove Spotify’s stock price down through the day on Wednesday.

UPDATE: Spotify stock fell 6% Wednesday

Podcasting continued to be Spotify’s focus and that is where most of its growth in advertising and overall consumption came from. But monthly active user growth over is clearly slowing.

On the earnings call Wednesday, CEO Daniel Ek said that more recent data suggests that any slowdown is temporary,

“Q2 was a strong quarter for Spotify overall, with the majority of our major metrics performing better than expected., said EK. “While MAU growth was softer than expected in the first half of the year, we are seeing that trendline reverse and all the leading indicators show that we are back on track. By accelerating our pace of innovation and investing for the long term, we continue to cement our standing as the preferred audio platform around the world.”

  • Premium Subscribers grew 20% Y/Y to 165 million in the quarter
  • Monthly average users grew 22% Y/Y to 365 million finishing below analyst expectations
  • Revenue grew 23% Y/Y to €2,331 million. Reported Revenue was toward the top end of our guidance range due to significant advertising strength and subscriber outperformance. 
  • Advertising –  Ad Supported revenue grew 110% Y/Y to $325 million or up 126% Y/Y based on constant currency, led by Direct and Podcast sales channels.
  • Podcasting consumption was up 95% Y/Y in aggregate and more than 30% Y/Y on a per user basis while week-over-week and month-over-month retention rates reached all-time highs. Podcast share of overall consumption hours also reached an all-time high. 

Read the full Spotify Q2 2021 earnings report here.

UPDATE: Spotify stock fell 6% Wednesday

A graphic produced by Spotify for the Q2 earnings announcements shares user stats and touts new features.

Bruce Houghton is Founder and Editor of Hypebot and MusicThinkTank and serves as a Senior Advisor to Bandsintown which acquired both publications in 2019. He is the Founder and President of the Skyline Artists Agency and a professor for the Berklee College Of Music.

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