Spotify just missed expectations for subscribers in the latest quarter, with the music-streaming company blaming a fumbled promotion for students as it looks to lure more people to sign up. The Swedish group added 8m subscribers in the three months to the end of June, with 108m people globally paying a monthly fee to use Spotify.
Wall Street analysts had been looking for 109m, while the company had guided for between 107m and 110m.
“We missed on subs,” Spotify said in a letter to investors on Wednesday.
“That’s on us.”
Barry McCarthy, chief financial officer, told the Financial Times the company had expected gains from a monthly student promotional programme that did not materialise. “We didn’t do it very well. We didn’t tell anyone or market it,” he said. “Unless you stumbled on it on the landing page, it didn’t exist.”
It was a relatively small miss in terms of the analysts’ forecasts, but Spotify’s shares slipped more than 4 per cent in pre-market trade.
The stock has climbed more than a third this year, outperforming the broader equity indices.
Spotify is the global leader in paid music streaming by a wide margin.
Rival Apple said it had 60m music subscribers as of June, while the FT reported that Amazon had signed up about 32m people to its music services at the end of April. On a call with investors, Spotify chief executive Daniel Ek noted that quarterly subscribers had grown 31 per cent year over year, “which we believe is roughly twice the rate of growth of our next closest competitor”.
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