Spotify already has over 600 million users. Every third person pays for a subscription
Revenues are increasing, losses are decreasing, users are increasing – this is how Spotify’s financial results from the fourth quarter of 2023 can be briefly described.
Spotify is the most popular music streaming service in the world, which is used by more and more people every month. The Swedish company offers its services, among others: in a simplified Freemium model, but earns money primarily thanks to people paying subscriptions, which give access to more functions and, above all, music played in much better quality. There are already over 600 million total users of the platform, and every third of them pays for access to the website. Spotify has just published its financial report for the fourth quarter of 2023.
602 million Spotify users
Compared to previous years, the number of people launching Spotify at least once a month increased by as much as 23% in 2023, which means that the Swedish streaming service is currently used by over 602 million people around the world. This is an excellent result, placing Spotify first in the popularity ranking of similar services.
It looks even better if we look at how many of these people actually pay for access to non-free variants of the service. The number of subscribers to premium packages increased from 205 to 236 million last year. Of course, there are still more users choosing the free option – their number increased from 295 to 379 million – but 29 million new subscribers obtained in one year is a very good result on the scale of the entire industry.
Billions in revenues, millions in losses
In the fourth quarter of 2023, subscription sales brought Spotify EUR 3.17 billion – 17%. more than in the same period of the previous year. Revenues from ads played to users of the Freemium package also increased – by 12%. up to EUR 501 million.
At the same time, the Swedish company’s loss, a common phenomenon in the streaming services industry, decreased last quarter to EUR 75 million from the EUR 231 million loss it recorded in the same quarter of 2022. Free cash flow also increased – from EUR 73 to EUR 396 million. Spotify’s profitability, although still in the red, is improving year by year, or rather month by month. This was influenced by, among others, decrease in research and development expenses, which decreased from EUR 468 to EUR 415 million.
