SPOTIFY TOPS 515M
TOTAL USERS

Spotify is reporting its biggest Q1 since going public in 2018, with monthly active users topping 515m and premium subscribers hitting 210m. Total revenue reached €3b ($3.3b), a 14% increase over 2022.

Premium revenue grew 14% to $2.97b, with the subscriber count up 15%.

MAU growth was 22% over 2002. Spotify attributed this performance to higher reactivations, improved retention and marketing efficiencies. The growth exceeded the company’s projection of 500m users by the end of Q1. The Spot is now predicting the count will hit 530m by the middle of the year.

Gross margin finished at 25.2%, reflecting improved music and podcast profitability.

This was the first quarter that Spotify hit €300m in advertising revenue.

The streamery's stock price, which topped $130 the last three weeks, is up more than 60% since the year began. CEO Daniel Ek told investors that the company has become “a lot leaner” since it laid off 6% of its workforce and that it's examining its real-estate footprint to see if more efficiencies can be found there.

Beyond the financials, Ek lightly addressed the issue of AI-generated “fake tracks,” specifically one labeled as being by Drake. “These are complex issues that don’t have a straight answer,” he said, noting that copyright holders have “legitimate concerns" and insisting, "We want to strike a balance that allows both innovation and protecting artists.”

On the other hand, Ek said that AI can be “huge for creativity,” opening the door for music made by “people who don’t know how to play music” or understand music software. “That should lead to more music," he noted. "The more creators on the site, the better. That’s the upside, but it’s way too early to speculate” on how it might play out.