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Spotify Technology
stock fell 10% in premarket trading Tuesday despite reporting its best ever quarter for new users. The music streaming platform’s losses widened in the second-quarter and it fell short of revenue estimates.
The company said it added 36 million monthly active users in the three months to June 30, which was 21 million above its guidance. Spotify added 10 million net subscribers, 3 million ahead of its forecast and a record for the second quarter.
Spotify (ticker: SPOT) reported a net loss of €302 million ($334 million), or €1.55 ($1.71) per share, compared to an 85 European cents, or €125 million, loss in the same period last year. Analysts were expecting a loss of 63 European cents. Revenue of $3.18 million narrowly missed estimates of €3.21 billion.
Operating losses widened to €247 million, from €194 million in the second quarter last year.
Spotify said it incurred higher music royalty costs, but made some improvement in podcast profitability. Its gross margin fell 47 basis points to 24.1% due to a €44 million charge relating to the cancellation of a number of podcast shows and the impairment of excess real estate.
The stock fell 4.7% Monday after the music streaming platform raised the monthly subscription price for its premium service. The shares pointed 9% lower in premarket trading Tuesday.
Write to Callum Keown at [email protected]
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