Spotify has announced that it has hit over 140 million monthly active users, with over 50 million being premium paying subscribers. The leading streaming service continues its supremacy over its biggest competitor—Apple Music, which has around 27 million subscribers.
All isn’t rosy for the Swedish company, though, as it continues to struggle financially. According to its annual financial disclosure, the company made a USD389 million operating loss in 2016.
This is despite its premium revenue and ad revenue increasing by 52% and 50% respectively, year-on-year.
Up, up, up
The company revealed that both monthly active users and paying subscribers have increased substantially. The principal contributor to the strong subscriber growth is the introduction of its global family plan.
Revenue performance however was partially offset by the price reduction on the existing family plan subscriber base. The Premium Family Plan costs just MYR22.40 per month for up to six accounts. A single Premium subscription, on the other hand, costs MYR14.90.
In 2016, Spotify raised USD1 billion from institutional investors, which it said was to ensure it has “the flexibility to continue to invest and be opportunistic regardless of the state of the capital markets.”
Earlier in the year, it entered a 17-year operating lease agreement to occupy a 380,000sq ft office space at the World Trade Center in New York. The deal is valued at around USD537 million.
The company also spent USD44 million in acquisitions of four privately held companies.
As a streaming service, Spotify depends on acquiring content licenses for major and minor content owners and rights holders. It landed a new deal with Universal Music (welcome back Taylor Swift), as well as signed multi-license agreements with certain music labels and publishes. The agreements include minimum guarantee commitments of around USD2.2 billion for royalty payments over the next two years.
Spotify was recently valued at USD13 billion, and is set to carry out direct listing on the New York Stock Exchange later this year or next year.