Spotify's stock dropped Tuesday due to its second-quarter results, which werebelow expectations and didn't meet analysts' revenue estimates. Although the company reported a year-over-year rise of 11% in revenue, from 2.86 billion euros to 3.3 billion euros, it fell short of the 3.4 billion euros anticipated by StreetAccount. Spotify also noted that its recent price increases are projected to have minimal effect on their total revenue in the third quarter.
Spotify's shares decreased 7% on Tuesday after their second-quarter results failed to meet analysts' expectations for revenue and their guidance was lower than anticipated. Income per share for the quarter totaled a loss of 1.55 euros, which was not in line with predictions. Revenues were 3.18 billion euros, below the 3.21 billion euros forecast by Refinitiv. This was an 11% increase on the same period last year when their sales were 2.86 billion euros. The firm posted a loss per share of 85 euro cents in the Q2 2022 report. Spotify is predicting a total revenue of 3.3 billion euros in the Q3, as opposed to the 3.4 billion euros expected by researchers at StreetAccount. During the quarter, 551 million people used the service on a monthly basis, representing a yearly rise of 27%. 36 million monthly active users were added during the three-month period and 220 million were subscribed to a paid plan, a 17% jump from the same time in 2021. In its prior Q1 report, Spotify anticipated adding circa 15 million users, taking their total to 530 million. The net loss was 302 million euros, up from 125 million euros from a year ago. The revenue from advertising grew 12% y-o-y and podcast commercials jumped over 30% y-o-y. Spotify declared on Monday that they would increase the price of some Premium programs by up to $2, which amounts to a 20% state. They declared in a blog post that the prices updates will provide support to both fans and artists. In the U.S., the premium individual plan is now $10.99, increased from $9.99; the Premium Duo plan is now $14.99, up from $12.99; the family scheme is $16.99, up from $15.99; and the Student plan is $5.99, up from $4.99. Spotify has stated that the price hikes are predicted to have "minimal impact" on their overall revenue during the third quarter. They will have their quarterly call with investors at 8 a.m. ET.
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