{"id":222624,"date":"2025-02-04T13:34:11","date_gmt":"2025-02-04T13:34:11","guid":{"rendered":"https:\/\/www.musicbusinessworldwide.com\/?p=222624"},"modified":"2025-02-13T12:33:10","modified_gmt":"2025-02-13T12:33:10","slug":"spotify-posts-1-5bn-annual-operating-profit-for-2024-as-subscriber-base-grows-to-263m-in-q41","status":"publish","type":"post","link":"https:\/\/www.musicbusinessworldwide.com\/spotify-posts-1-5bn-annual-operating-profit-for-2024-as-subscriber-base-grows-to-263m-in-q41\/","title":{"rendered":"Spotify posts $1.5bn annual operating profit for 2024, as subscriber base grows to 263m in Q4"},"content":{"rendered":"MBW\u2019s Stat Of The Week is a series in which we highlight a data point that deserves the attention of the global music industry. Stat Of the Week is supported by\u00a0music data analytics firm\u00a0Chartmetric<\/a>.\r\n\r\n
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Spotify<\/a> saw its global Premium Subscriber base grow to 263 million<\/strong> paying users in Q4 \u2013 and achieved its first full year of operating profit in 2024.<\/p>\n

That’s according to Spotify\u2019s investor filing published today (February 4). The filing shows that the streaming company’s global Premium Subscriber base of\u00a0263 million<\/strong> paying users in Q4 2024 (ending December 31) was up 11%<\/strong><\/span> year over year.<\/p>\n

SPOT’s paid user base of 263 million<\/strong> subs <\/span>was up by 4%<\/strong><\/span>, or 11<\/strong>\u00a0million<\/b> net subscribers, on the 252<\/strong>\u00a0million<\/b> the company counted at the end of the prior quarter (Q3 2024).<\/p>\n

The music streaming company says that its 11<\/strong> million<\/b> net subscriber additions in Q4 “significantly outperformed” \u2013 surpassing guidance by 3 million subs.<\/p>\n

In the 12 months to the end of December, Spotify added +27 million<\/strong> net paying subscribers. (It finished 2023 with 236 million paying subs.)<\/p>\n

Spotify also reports that its operating income finished at “a record high” of \u20ac477 million ($509.48m) <\/strong>in Q4, driving the company’s first full year of Operating Income profitability to \u20ac1.4 billion ($1.495bn).<\/strong><\/p>\n

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Commenting on the company’s latest results, Daniel Ek, Spotify Founder and CEO, said: “I am very excited about 2025 and feel really good about where we are as both a product and as a business.”<\/p>\n

Credit: Sipa US\/Alamy<\/figcaption><\/figure>

\u00a0“I am very excited about 2025 and feel really good about where we are as both a product and as a business.”<\/p>\n

Daniel Ek<\/span><\/p><\/blockquote>\n

Added Ek: “We will continue to place bets that will drive long-term impact, increasing our speed while maintaining the levels of efficiency we achieved last year.<\/p>\n

“It\u2019s this combination that will enable us to build the best and most valuable user experience, grow sustainably and deliver creativity to the world.”<\/p>\n

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Monthly Active Users<\/h6>\n

Spotify\u2019s total global Monthly Active Users (MAUs) grew 12% YoY<\/strong><\/span> to 675 million<\/strong>\u00a0in Q4 2024 and by 5%<\/strong><\/span> (35m) <\/strong>compared to the previous quarter (Q3 2024) when the platform counted 640\u00a0million<\/strong>\u00a0MAUs.<\/p>\n

The company\u2019s 675 million<\/strong> MAU additions in Q4 were also 10 million<\/strong> ahead of guidance, with SPOT noting that its “net additions of 35 million [MAUs] marked the largest Q4 in [its] history”.<\/p>\n

SPOT reports that its quarterly MAU performance reflected growth across all regions, led by its Rest of World and Latin America (see below) geographic segments, which accounted for 34%<\/strong> of and 22%<\/strong> of SPOT’s global MAU base, respectively.<\/p>\n

The company also cites “shifts in competitor dynamics in select developing markets” as a driver of both MAU and Premium subscriber growth.<\/p>\n

Rival streaming service TikTok Music notably shut down<\/a> on November 28 in the five regions where the app was previously live: Indonesia, Brazil, Australia, Singapore and Mexico.<\/p>\n

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Premium revenue<\/h6>\n

In terms of finances, Spotify reports that its Premium subscriber growth translated into Premium revenue of \u20ac3.705 billion<\/strong> (USD $3.957bn) in Q4 2024.<\/p>\n

Spotify\u2019s Premium revenue was up 19% YoY<\/strong><\/span>\u00a0at constant currency (see below).<\/p>\n

Premium revenues were driven by subscriber growth of 11% YoY<\/strong><\/span> and a Premium ARPU (Average Revenue Per User) increase of 7% YoY<\/span> <\/strong>at constant currency to \u20ac4.85<\/strong> ($5.18).<\/p>\n

Excluding the impact of FX, SPOT reports that its ARPU performance was driven by “price increase benefits, partially offset by product\/market mix”.<\/p>\n

In terms of subscriber performance geographically, Spotify reports growth across all regions with \u201coutperformance\u201d led by “Rest of World<\/strong>” which accounted for 14%<\/strong> of SPOT’s Premium Subscriber base at the end of Q4.<\/p>\n

North America and Europe accounted for 26%<\/strong> and 37%<\/strong> of SPOT’s global Premium subscriber base at the end of Q4, respectively, down from 27% and 38% respectively in Q4 2023.<\/p>\n

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Ad-supported revenue<\/h6>\n

Spotify\u2019s ad-supported revenue, meanwhile, hit\u00a0\u20ac537 million<\/strong> ($573.56m) in Q4, up 6% YoY\u00a0<\/strong><\/span>at constant currency (see below).<\/p>\n

Spotify reports that its Ad-supported revenue performance reflected YoY growth across all regions and that “both Music and Podcast advertising was driven by growth in impressions sold, partially offset by softness in pricing”.<\/p>\n

SPOT notes in its investor presentation that its “automated sales channels were the largest contributors to overall advertising growth”.<\/p>\n

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Profitability<\/h6>\n

The company\u2019s Gross Margin finished at 32.2%\u00a0<\/strong>in Q4.<\/p>\n

Meanwhile, Spotify posted a quarterly operating income of over half a billion dollars \u2013 at \u20ac477 million ($509.48m) <\/strong>\u2013 in the quarter.<\/p>\n

Spotify noted that its “operating Income finished at a record high” and drove “Spotify\u2019s first full year of Operating Income to \u20ac1.4 billion” ($1.495bn).<\/p>\n

According to Spotify, its operating Income of \u20ac477 million ($509.48m) <\/strong>reflected “lower personnel<\/strong> and related costs and lower marketing spend, partially offset by \u20ac96 million ($102.53m<\/strong>) in Social Charges At the end of Q4″.<\/p>\n

Spotify reports that its workforce consisted of 7,261<\/strong> full-time employees globally at the end of 2024.<\/p>\n

SPOT’s Operating Income Q4 2024 of \u20ac477 million<\/strong> was \u20ac4 million<\/strong> below guidance.<\/p>\n

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In terms of guidance for Q1 2025, Spotify forecasts reaching 678 million<\/strong> MAUs, an addition of around 3\u00a0million<\/strong>\u00a0net new MAUs in the quarter.<\/p>\n

The company projects its total Premium Subscriber base to hit 265\u00a0million<\/strong> in Q1, an addition of approximately 2 million<\/strong>\u00a0net new subscribers in the quarter.<\/p>\n

Spotify forecasts an operating income of \u20ac548 million<\/strong> for Q1, and total revenue of \u20ac4.2 billion<\/strong>.<\/p>\n

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All EUR-USD conversions made at the average rate of the relevant period according to the European Central Bank<\/em><\/p>\n

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<\/a><\/figure>Chartmetric<\/a> is the all-in-one platform for artists and music industry professionals, providing comprehensive streaming, social, and audience data for everyone to create successful careers in music.<\/em><\/span><\/strong>\n","protected":false},"excerpt":{"rendered":"

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