Spotify records growth in the premium subscriber base by 31% in Q1

Music streaming service Spotify on Wednesday said it has seen a 31 per cent year-on-year surge in the number of its premium subscribers. Both monthly active users (MAUs) and premium subscribers are helping the company report a 22 per cent jump in the first-quarter revenue of 2020.

In line with its forecast and expectations, Spotify's total MAUs reached 286 million, while its numbers of premium subscribers hit 130 million globally.

Spotify earns through a mixture of paid subscriptions and showing ads on free service.

The company's revenue hit 1,848 million euros in Q1, representing a growth of 22 per cent year-on-year.

Much of it came from premium revenue which grew 23 per cent year-on-year to 1,700 million euros.

Ad-supported revenues grew 17 per cent year-on-year to 148 million euros.

"Of note, we are beginning to see growth in reactivations following stay-at-home orders being implemented globally," Spotify said in its letter to shareholders.

The Swedish music streaming firm said that it has taken steps to slow hiring for the remaining three quarters of 2020 and have reduced open headcount by roughly 30 per cent from prior growth expectations.

"We will continue to grow, and believe we are in a great position to invest in product and innovation. We also recognise it may be more challenging to effectively recruit and onboard given the inherent uncertainty moving forward," the company said.

Shares of Spotify jumped more than 9 per cent in pre-market trading on the New York Stock Exchange.

*Edited from an IANS report