Spotify Q1: Exceeding expectations

“We had our strongest Q1 since going public in 2018, with nearly all our KPIs surpassing expectations.” –Spotify

With an ebullient tone, Spotify released its Q1 earnings, flush with upward-moving numbers. The company’s articulation of Q1’s high points:

  • Monthly Active Users grew by 22% year-over-year to 515 million driven by strength in both developed and developing markets, and nearly all age groups.
  • Premium Subscribers grew 15% year-over-year to 210 million with outperformance across all regions, led by Europe and Latin America.
  • Revenue grew 14% year-over-year to €3.0 billion, led by Subscriber gains.
  • Gross Margin finished at 25.2%, reflecting improved music and podcast profitability.
  • Operating (Loss)/Income finished at €(156) million, aided by lower marketing spend.

“Nearly all of our Q1 KPIs surpassed expectations,” Spotify observed. “Overall, we are encouraged by the strong start to 2023.” Below is the graph illustrating actuals vs. expectations:


The Q1 financials put more details into the generally upbeat news:

SPOT stockholders loved it:


And indeed, it has been an upward-tilting 12 months for Spotify stock:

Brad Hill