Spotify Reports 180 Million Premium Subscribers Amid Joe Rogan Row

Shares of Spotify tumbled Wednesday after the music streaming service — roiled in controversy over its star podcaster Joe Rogan — projected decrease revenue margins within the coming earnings interval as subscriber progress slows.

The firm reported strong will increase within the fourth quarter when it comes to month-to-month lively customers and 180 million premium subscribers, in step with earlier forecasts.

But the streaming service forecast its first quarter 2022 gross revenue margin would fall to 25 p.c from 26.5 p.c. And it projected including simply three million premium subscribers in that interval, a marked slowdown from latest quarters.

Over the final week, Spotify has been hit with the defection of a number of music superstars together with Neil Young and Joni Mitchell over its dealing with of Rogan’s controversial statements on COVID-19 vaccines.

Executives nonetheless touted the platform’s long-term progress potential and broadly defended their dealing with of the Rogan controversy, including that it was too quickly to know the way it could have an effect on the corporate’s monetary efficiency.

Spotify’s shares fell 10.9 p.c to $171.00 (roughly Rs. 12,800) in after-hours buying and selling.

The inventory has fallen sharply steeply during the last yr, together with different “stay-at-home” shares that benefited from the disruptions to each day life brought on by the COVID-19 pandemic.

The firm reported a quarterly lack of EUR 39 million (roughly Rs. ) as revenues elevated 24 p.c to EUR 2.7 billion.

Spotify pointed to “continued momentum in our subscription business and meaningful advertising results,” including that “we see a tremendous amount of greenfield on the horizon.”

Spotify’s press launch made no point out of the Rogan controversy, whereas emphasising that consumption tendencies on the podcasting platform “remained strong.”

Too early to gauge impression

On Sunday, Chief Executive Daniel Ek introduced that Spotify would add a content material advisory to any podcast that discusses COVID-19, directing customers to authorities well being authorities and different trusted sources.

The transfer adopted criticism from Young and different artists who left the platform after a name from medical professionals to stop Rogan from selling “several falsehoods about COVID-19 vaccines.”

On Wednesday, Young’s former bandmates from Crosby, Stills, Nash and Young mentioned that they had requested their labels to take away their recordings from Spotify.

Ek addressed the matter in opening remarks and once more in response to repeated questions from analysts.

While saying Spotify might have articulated its coverage sooner, Ek mentioned he was happy with how the corporate responded.

“We’re trying to balance creative expression with the safety of our users,” Ek mentioned.

“We don’t change our policies based on one creator nor do we change it based on any media cycle, or call from anyone else,” he mentioned.

“Our policies have been carefully written with the input from numbers of internal and external experts in this space.”

Ek mentioned it was “too early” to gauge the impression of the Rogan controversy on his enterprise, including “usually when we’ve had controversies in the past, those are measured in months and not days.”