It is one of the big questions in our society, always thirsty for curious data. How many users does Spotify currently have? And most importantly, how many are paying users and how many use the free tier. Today, we have the answer for you.
Spotify has 220 million Premium subscribers and 551 million monthly active users, as announced by the company in its latest earnings report.
This represents a 27% and 17% increase, respectively, compared to the same period last year, exceeding the forecasts published last quarter.
The paradox of streaming, more users and more losses
But despite the increase in the number of listeners, Spotify reports that it is earning less revenue on average from each user. In today’s statement, Spotify states that its average revenue per user is currently €4.27, which represents a 6% year-on-year decrease and a slight decline compared to the €4.32 from the previous quarter.
The second-quarter earnings report comes less than 24 hours after Spotify announced that it would be raising its prices in the U.S. and other markets worldwide, following the lead of other streaming music apps like Apple Music, Amazon Music, Tidal, and YouTube Music Premium.
The price hikes by Spotify are clearly aimed at reversing the decline in its revenue per user, although their impact will not be visible until the next quarter.
Meanwhile, in 2023, the company made several cutbacks after its CEO, Daniel Ek, stated that the company’s priorities for the year were “speed and efficiency.”
In January, they announced the layoff of 6% of its global workforce, which amounted to around 600 employees. In April, Spotify shut down Spotify Live, a competitor of Clubhouse, and Heardle, a competitor of Worldle. Then, in June, they eliminated another 200 positions from their podcasting division.
The company reported a net loss of 302 million euros this quarter, compared to the 125 million euros loss in the same quarter of the previous year.
It’s not particularly surprising for a company that usually prioritizes growth over quarterly profits, but it’s evident that they are working to reduce these losses in the future.
If the most widely used audio sector app is experiencing losses every quarter, it’s clear that the model isn’t working.
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