Spotify shares pop after earnings show strong user growth

Spotify shares popped arsenic overmuch arsenic 10% successful premarket trading Tuesday aft the institution reported fourth-quarter earnings that bushed analysts' expectations for gross and showed beardown idiosyncratic growth.

Here's however the institution did:

• Loss per share: Loss of 1.40 euros vs. an estimated nonaccomplishment of 1.27 euros arsenic expected by analysts, according to Refinitiv
• Revenue: 3.17 cardinal euros vs. 3.16 cardinal expected by analysts, according to Refinitiv

Spotify reported 489 cardinal monthly progressive users for the quarter, up 20% twelvemonth implicit year. There were 33 cardinal nett additions to monthly progressive users during the quarter, marking a grounds precocious for the company. Spotify besides reported 205 cardinal paid subscribers, up 14% from a twelvemonth ago.

In its third-quarter report, Spotify said it expected to adhd astir 23 cardinal caller monthly progressive users successful Q4, bringing its full to 479 million. It had besides expected its gross to summation to 3.2 cardinal euros and to station 202 cardinal paid subscribers successful the quarter.

Spotify is continuing to put successful advertising, and its ad-supported gross grew 14% twelvemonth implicit twelvemonth and accounted for 14% of full revenue. The institution said maturation was driven by podcasting.

Earlier this month, Spotify announced plans to cut 6% of its planetary workforce arsenic it contends with a gloomy economical situation that has caused consumers and advertisers to bounds their spending. The cuts impacted astir 600 employees.

CEO Daniel Ek wrote a note to employees, which was posted publically connected the company's website, and said helium takes "full accountability for the moves that got america present today."

"In hindsight, I was excessively ambitious successful investing up of our gross growth," helium said.

Spotify held its quarterly net telephone with investors astatine 8:00 a.m. ET Tuesday.