What you need to know
- Spotify has released its Q1 2022 full earnings report, which shows a strong performance in the past quarter.
- Premium subscribers increased 15% year-over-year in the first quarter to reach 182 million.
- The service's revenue reached €2.66 billion in Q1, surpassing estimates of €2.61 billion.
Spotify may have lost more than $2 billion in market value in the wake of the Joe Rogan backlash earlier this year, but its latest earnings report reveals that the controversy had no negative impact on the business.
During the first quarter of 2022, Spotify's paid subscribers grew 15% year-over-year to reach 182 million, up from 158 million in the same period last year.
The service's exit from Russia didn't make a dent in its performance during the last quarter either. Spotify said in its letter to shareholders that despite losing 1.5 million subscribers in Russia, its overall subscriber growth surpassed expectations thanks to its robust performance in Latin America and Europe.
Spotify announced last month that it would be discontinuing its services in Russia due to the passage of new laws restricting free speech. Fortunately, its subscriber loss in the country was offset by strong growth in its two key non-North American markets. European customers now account for 39% of paid subscribers, while Latin Americans account for 21%.
The platform also retains its reputation as one of the best music streaming services to beat, reporting total monthly active users of 422 million in Q1, up 19% YoY to surpass estimates of 417.1 million.
In terms of revenue, the service generated €2.66 billion ($2.82 billion) in the first quarter, a 24% YoY increase that exceeded expectations. Premium subscription revenue increased by 23% YoY to €2.38 billion, while ad-supported revenue increased to €282 million, up from €216 million in Q1 2021.
On the other hand, Spotify's average revenue per user (ARPU) dropped from €4.40 in the previous quarter to €4.38 in Q1, though it represents a 6% YoY increase.
Spotify also used the occasion to highlight some upcoming features and recent developments. This includes the upcoming launch of a new billing system in collaboration with Google later this year. In addition to Google Play Billing, users will be able to select Spotify's own payment system as their preferred billing method.
The company also mentioned its recent acquisitions of Podsights, a podcast ad measurement service, and Chartable, an analytics platform. Spotify's podcast footprint saw significant growth as well, from 3.6 million podcasts at the end of Q4 2021 to 4 million in Q1.
"Growth in the number of MAUs (monthly active users) that engaged with podcast content continued to outstrip total MAU growth, podcast consumption rates grew in the double digits Y/Y; and podcast share of overall consumption hours on our platform reached another all-time high," Spotify said in its letter.
