In its Q3 earnings release Spotify might be daring observers to find a negative number. Perhaps there are some minuses deep in the metrics, but the headline numbers are all upward.
Subscribers: This key user metrics rose 12% from last year’s Q3, reaching 281 million. Those are the paying customers who get an ad-free experience. Total users is a different measure…
MAUs: that’s Monthly Average Users, a tabulation which includes subscribers plus non-subs, reached up to 73 million.
“The business is healthy. We’re shipping faster than ever. And we have the tools we need — pricing, product innovation, operational leverage, and eventually the ads turnaround.” — Daniel Ek, CEO, Spotify
Daniel Ek’s quote, above, references a Q3 dip in advertising, and Ek’s confidence that it will recover.
Two parts
As a dual business — subscription and advertising — Spotify emphasizes improvements to the free (ad-supported) service. The Q3 release mentions enhancements including “making it easier to listen, connect, and share music for free.” That’s a bit vague, but this is more specific: “Users now have more control to search and play any track, or o jump right into a song a friend shared.”
Guess how many Spotify playlists users have created. Go ahead; guess. It’s nine billion.
Audiobooks
Spotify first mentioned audiobooks in a June 2022 investor gathering (RAIN HERE). Today it is a thriving category. In the Q3 earnings report we read, “In just two years, Spotify has introduced millions of new listeners to audiobooks.” That’s a little confusing, but Ek is referring to the addition of free audiobook listening in the Premium level. That initiative now covers 14 global markets with a collection of 500,000 English language markets. The earnings report claims 36% year-over-year rise in audiobook listening.
Taylor Swift
There’s a whole section on her. Lots of historic firsts.
New for advertisers
Spotify unveils a connection with Amazon’s Demand Side Platform (DSP). Advertisers using that platform can access Spotify ad inventory (audio and video). Spotify also notes incoming relationships with other DSPs: ID5, Smartly, and Yahoo DSP.
Between April, when Spotify’s DSP launched, and today, the number of participating advertisers has increases 42%.