Spotify on Wednesday predicted fewer subscribers for the current quarter than Wall Street expected, but executives sought to reassure investors that the company’s growth has not stalled, despite the controversy surrounding The Joe podcast. Rogan Experience.
Spotify shares tumbled as much as 18% in post-trade trading after the company released its subscriber forecast.
“While we do not release further estimates for the year on subscribers, we do not expect a material difference in net additions of either users or subscribers in 2022 versus 2021,” Chief Financial Officer Paul Vogel told Reuters.
Stocks reduced losses and were down between 3% and 9% after the initial shock.
The forecast played down fourth-quarter revenue performance, which came in higher than expected, driven by sales of more ads and new services like podcasts. The paying subscriber base grew 16% and total monthly active users rose 18% to a record 406 million.
But the company forecast 183 million paying users for the current quarter, below expectations of 184 million. Revenue must meet the expected 2.6 billion euros (R$ 15.5 billion).
The music streaming service has invested more than US$ 1 billion (R$ 5.3 billion) in the area of ​​podcasts, led by exclusive programs such as The Joe Rogan Experience.
But the star also attracted controversy after his show aired with controversial comments about Covid-19 that drew protests from artists like Neil Young and Joni Mitchell.
Rogan, a popular internet commentator, has apologized and Spotify has said it will start adding content alert messages to programs that discuss the pandemic.
Spotify Chief Executive Daniel Ek said the company already has a team dedicated to content moderation.
“We’ve taken action on more than 20,000 podcasts since the start of the pandemic,” Ek told Reuters. “So that describes the size of this operation. It’s a truly global operation.”
“Although Joe has a huge audience, he now has the #1 podcast in over 90 markets, he also has to comply with Spotify’s policies,” said Ek.
The company’s paid subscribers, which account for most of the company’s revenue, grew to 180 million, compared with analysts’ forecasts of 179.9 million.
Revenue rose to 2.69 billion euros (R$ 16.1 billion), compared to 2.17 billion (R$ 12.9 billion) a year earlier. Analysts on average had forecast sales of 2.65 billion euros (R$ 15.8 billion) in the quarter, according to Refinitiv data.
Source: Folha
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