Spotify shares surged eight per cent on Tuesday after the streamer said it has hit a new record number of subscribers. But it reported a €75m (£64m) loss as it continues its cost-cutting strategy.
The Swedish company, which is listed on the New York Stock Exchange, said it hit a record number of subscribers this year, adding 28m in the fourth quarter of 2023, and giving it a total of 602m subscribers, one million ahead of guidance.
But after posting a third-quarter operating income of €32m ($34.1 m) last year – its first quarterly profit since 2021 – Spotify has swung back into the red, partly due to increased “efficiency efforts”.
The €75m loss, down from an income of €65m (£55.5m) in the third quarter, was an improvement on the €270m loss (£231m) it reported at the end of the previous financial year.
Spotify is expecting operating profit to hit €180m (£154m) in the first quarter of 2024.
Chief executive Daniel Ek is currently trying to steady the ship and recently laid off about 1,500 employees in a bid to reduce costs.
And Ek’s troubles don’t stop there. Last month, he made his stance against Apple’s App Store policies and fees clear in a furious open letter to the tech giant.
On Friday, his company announced a multi-year deal with controversial comedian and podcaster Joe Rogan, in an effort to boost its advertising revenue and reach through the world’s most popular podcast.
Spotify shares have risen almost 100 per cent over the past year.