Streaming music leader Spotify Technology on Tuesday smashed expectations for new subscribers and total listeners in the first quarter. Spotify stock surged on the news.
The Stockholm-based company added 5 million premium subscribers in the March quarter. Analysts had expected 2.23 million new subscribers. Spotify ended the period with 210 million total paying subscribers worldwide.
Also, Spotify tallied 515 million monthly active users in the first quarter, vs. Wall Street's target of 502 million. Spotify offers an ad-supported service in addition to its commercial-free subscription service. Its monthly active users rose 22% year over year.
Spotify announced March 8 that it had cracked the milestone of a half-billion listeners in the first quarter.
Spotify Stock Rises After Quarterly Report
For the current quarter, Spotify forecast adding 7 million net new premium subscribers. Also, it expects to reach 530 million total monthly active users in the June quarter.
On the stock market today, Spotify stock jumped 5.1% to close at 138.20.
The audio entertainment service lost the equivalent of $1.24 a share on sales of $3.26 billion in the March quarter. Spotify reports financial results in euros. Analysts polled by FactSet had predicted Spotify would lose 95 cents a share on sales of $3.4 billion.
Revenue missed expectations because of weakness in the advertising market, the company said.
Spotify stock has an IBD Relative Strength Rating of 94 out of 99, according to IBD Stock Checkup. That puts it in the top 6% of stocks for performance over the past 12 months.
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