The world number one of musical streaming platforms, which will suppress 6 % of its global workforce, promises “better efficiency” in 2023, after losing 430 million euros in 2022.
by Nicole vulser
Thank you to Taylor Swift, who, by released his tenth album Midnights on October 21, 2022, has instantly became the most listened to one day in the story of Spotify. It is partly thanks to her that Daniel Ek, the CEO and founder of the world number one of audio streaming platforms has rejoiced, Tuesday, January 31, to have reached a new peak of 205 million paid subscribers in the world at the end of 2022 (+14 % compared to the end of 2021).
Multiple advertising campaigns have made their office by retaining, in particular in Latin America, new subscribers of the Z generation (born in the late 1990s). This better result than the 202 million expected by analysts resulted in a 21 % increase in turnover, at 11.72 billion euros over the year 2022.
The number of total users, including those of the free version, culminated at the end of December 2022 at 489 million and should cross the 500 million course during the first quarter 2023.
“too ambitious”
On the other hand – this is indeed the throbbing and chronic problem of this Swedish flagship – its net losses were singularly dug in 2022 to dive at 430 million euros (against 34 million deficit in 2021). As analysts had predicted 441 million losses, the Spotify action jumped 5 % before the opening of Wall Street, at $ 105 (96.65 euros). An epiphenomenon despite everything since for two years, the group’s market capitalization has unscrewed from 70 % to $ 21.2 billion.
Does the wind run for the world’s number one online music? In the wake of the Net giants who like Amazon, Meta, Microsoft and Google have massively dismissed to reduce their costs, Spotify announced on January 23 a 6 % suppression plan of its global workforce, or 500 employees. “With hindsight, I was too ambitious by investing faster than our turnover growth,” said Daniel Ek.
In fact, Spotify’s investments have increased twice as fast as its income in 2022. To become a world leader in Podcast, the group has spent a billion euros in recent years. This diversification also earned him a good number of implications, especially with the American star Joe Rogan, accused of conveying false information on the COVVI-19.
Even if Daniel EK promised “better efficiency” in 2023, after “excellent growth” in 2022, analysts find it difficult to know when this start-up founded in 2006 in Stockholm will be profitable. With its spectacular advance towards Apple Music or Amazon Music, the company is “on the right path” towards profitability, just promised the CEO, without giving a date. And he feels “candidly in a better position than [s] competitors” to face Tik Tok if the latter decides to launch a paid offer.