Spotify added 2 million new subscribers in the first quarter to hit 182 million paying members at the end of March, the music streaming service said Wednesday. Spotify also said 422 million people used its service at least once a month, which includes people who listen free with advertising. That's up 19% from a year earlier.
The increase in subscribers was slightly shy of expectations. The latest figures coincide with the period that hashtags like #CancelSpotify were trending, sparked by artists' protests over COVID misinformation on Joe Rogan's popular podcast, but Spotify was also hit by a loss of 1.5 million subscribers because the service stopped operating in Russia, one of many companies that pulled out of the country following its invasion of Ukraine.
And Spotify said that its monthly active users would have clocked in at 419 million, had the service not experienced an outage that logged out some Spotify users involuntary. Believing certain users created new accounts to log back in, Spotify estimated the event led to about 3 million more monthly active listeners showing up in the quarter.
Analysts on average were expecting Spotify to report 2.69 million new subscribers and 418.5 million monthly listeners, according to Refinitiv.
Looking ahead to the second quarter ending in June, Spotify projected it would hit 187 million subscribers and reach 428 million monthly listeners. Analysts were expecting guidance for 189 million total subscribers and 427.75 million listeners.
In late January, singer-songwriter Neil Young triggered a debate about the service's role in moderating the messages promoted on its service, as he pulled his music from Spotify over objections to COVID-19 vaccine misinformation on Rogan's podcast. Young's boycott came after hundreds of medical professions pointed to Rogan as they called on Spotify to tackle COVID misinformation more aggressively.
The latest figures reiterate Spotify's dominance in subscription music around the world. Its No. 2 competitor, Apple Music, doesn't routinely disclose its paid membership and hasn't offered an update in more than two years, obscuring just how much of a lead Spotify may have. Apple Music last disclosed the size of its subscriber base in June 2019, when it had 60 million members, though it has surely grown in the intervening years. (According to music industry researcher Midia, Apple held about 15% of the world's subscription music market last year, and Spotify's share is double that.)
In the first quarter, Sweden-based Spotify reported a profit of 131 million euros ($140 million), or 21 euros a share. A year earlier, it reported a profit of 23 million euros, but on a per-share basis, it posted a loss of 25 cents. Revenue rose 24% to 2.66 billion euros in the quarter.
Analysts were expecting a per-share loss of 23 cents and revenue of 2.62 billion euros.
Spotify shares were down 2.2% at $108 in premarket trading.