Spotify at a loss

Spotify at a loss

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Spotify posted a huge €1.2bn loss for 2017. That’s on revenue of €4.1bn from its 159m monthly active users, 71m of whom are premium subscribers stumping up a monthly fee for on-demand music streaming. 

The streaming company is hardly upbeat about its prospects. “We have incurred significant operating losses in the past, and we may not be able to generate sufficient revenue to be profitable… our revenue growth rate may decline,” it said in a prospectus filing with the US Security and Exchange Commission.

Spotify also says it expects its costs to spike, “which could negatively affect our future operating results and ability to achieve profitability”. There will be substantial financial spend on securing audio and video content from leading music labels, distributors, aggregators, on creating new forms of original content, and on the firm’s tech infrastructure.

Spotify is set to offer its shares via a direct listing, rather than through a standard IPO, with stock made available on the New York Stock Exchange some time this year.

Image: Spotify

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