Spotify: Can Growth Offset Losses?
As streaming service SPOTIFY gears up for its direct listing on WALL STREET later this year, the company’s Q3 2017 financials show full 2017 operating losses will top $369 million, according to a report in DIGITAL MUSIC NEWS. On revenues of $3 billion, SPOTIFY’s losses topped $581 million in 2016, for a total of $1 billion in just two years.
In 2015, the streamer reported losses of $205 million, with a three-year loss of $1.16 billion. Those losses come on the heels of the news APPLE MUSIC could challenge SPOTIFY — which now boasts 70 million paid users — for most subscribers by the Summer. APPLE’s global user base now tops 36 million, but it is growing at a more rapid pace than SPOTIFY.
A report published last DECEMBER showed that top SPOTIFY executives earned seven-figure salaries in 2017. The company will reportedly spend more than $566 million for a 17-year lease on new MANHATTAN offices.
SPOTIFY must work quickly to convince investors that it will grow quickly. Private trading in the company placed its valuation at over $19 billion, with estimates it could go over $20 billion once it goes public.
Halfway through 2018, the investment bank expects the platform’s subscription numbers to reach 100 million. By the end of 2020, its user base may rise to 500 million, with 200 million global paid subscribers.
In the third quarter of 2017, two investors confirmed that SPOTIFY generated $1.2 billion in revenue. Full-year revenue will reach close to $5 billion, up 40% over 2016.
This Article Was Originally Posted at www.allaccess.com