Spotify‘s been making headlines globally over the previous 24 hours for its choice to lastly increase its subscription costs in over 50 markets, together with the US.

On Monday (July 24), MBW explored how a lot this spherical of value will increase may very well be price to the corporate – and to the music business.

Extra information from the streaming large arrives as we speak (July 25), as Spotify declares its monetary outcomes and consumer numbers for the second quarter of 2023 (ended June 30).

First, the headline stats: Spotify’s world Premium Subscriber base grew to 220 million paying customers within the quarter (ended June 30).

That was up 17% year-on-year, and up by 5%, or 10 million subscribers, on the 210m that SPOT counted on the finish of the prior quarter (Q1 2023).

The corporate’s whole world Month-to-month Energetic Customers (MAUs), in the meantime, grew 27% year-on-year to 551 million in Q2 2023 and by 7% in comparison with the earlier quarter (Q1 2023) when the platform counted 515 million MAUs.

Spotify stated in its investor presentation “that each one areas outperformed and noticed greater MAU internet additions relative to the prior yr interval, aided by improved retention and advertising efficiencies”.

The corporate additionally notes that its MAU internet additions of 36 million had been above steering and an all-time excessive for the corporate.

This efficiency, based on SPOT, was pushed by “continued enhancements in Advert-Supported retention and efficiency advertising efficiencies” in addition to “shifts in competitor dynamics in choose creating markets”.

The corporate additionally notes that it noticed “robust development amongst Gen Z listeners”.

SPOT’s Premium subscriber internet additions of 10 million had been 3 million forward of steering. The corporate says that its Premium subscriber efficiency in Q2 was pushed by a promotional marketing campaign “contributing to subscriber upside”, and “outperformance throughout all areas, led by Europe and Latin America”.

Spotify’s Advert-Supported MAUs grew by 26 million – from 317 million within the prior quarter (Q1 2023) to 343 million in Q2.

By way of funds, Spotify’s Premium subscriber development translated into Premium income of €2.773 billion ($3.01bn, as per the common quarterly change price printed by the European Central Financial institution) in Q2, which was up 14% YoY at fixed foreign money.

The agency’s ARPU (Common month-to-month Income per Subscriber) landed at €4.27, down 3% YoY fixed foreign money.

In the meantime, Spotify’s ad-supported income hit €404 million ($439.83m) in Q2, up 15% YoY at fixed foreign money (see under).

The corporate’s whole income (together with Premium and ad-supported) reached €3.177 billion ($3.458bn) in Q2, up 14% YoY at fixed foreign money.

The corporate’s Gross Margin completed at 24.1% in Q2, whereas, when it comes to profitability, Spotify posted an working lack of €247 million.

SPOT states in its investor presentation that its reported Gross Margin and Working Loss “had been each primarily impacted by expenses associated to our actions to streamline operations and cut back prices”. (Round 200 staff had been laid off from the corporate’s podcast division throughout the quarter.)

Spotify additionally notes that its Working Lack of €247 million in Q2 was impacted by €135 million in internet expenses. “These expenses embody the aforementioned influence to Gross Margin and a further €91 million associated primarily to our actual property optimization plan and severance,” the corporate stated.

Excluding these things, SPOT’s Adjusted Gross Margin of 25.5% (which excludes €44 million in internet expenses) was in-line with steering and its Adjusted Working Lack of €112 million was higher than steering (see under).

By way of steering for Q3, Spotify forecasts reaching 572 million MAUs, an addition of round 21 million internet new MAUs within the quarter.

The corporate tasks its whole Premium Subscriber base to hit 224 million in Q3, an addition of roughly 4 million internet new subscribers within the quarter

“General, we’re inspired by the power we noticed in Q2 and our momentum heading into the again half of 2023,” stated SPOT in in its investor submitting on Tuesday.

All EUR-USD conversions made on the common price of the related interval based on the European Central Financial institution.Music Enterprise Worldwide