Spotify has forecast weaker than expected subscriber numbers for the current quarter, somewhat overshadowing strong financial results for the end of 2021.
The streaming giant, whose share prices has been intermittently falling since November, saw shares fall further after latest financial results and the Neil Young and Joni Mitchell's stand against the company for its support of Joe Rogan.
The veteran musicians asked for their music to be removed from the platform over alleged disinformation about vaccines being spread by the presenter, who signed a $100m (€88.6m) deal to exclusively licence his popular podcast to Spotify in 2020.
Spotify shares fells as much as 18% after the company predicted it would increase its number of premium subscribers to 183m in the three months to the end of March, a million short of analyst expectations.
The Swedish streamer now has a record 406m users, an increase of 18% year-on-year, some 180m (+16%) of whom are paid subscribers. The rest use the advert-supported version of the app.
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Revenues ($2.7bn) and gross profits ($712m) at the company both rose 24% from the same period in 2021.
Spotify posted an operating loss of $7m (€6.2m) for the quarter as the operating expenses topped $719m, with the company continuing to plough money into its podcasting business.
There are now 3.6m podcasts available on the Spotify platform, and the company said it saw a 20% increase in the number of users listening to podcasts.
Following the Rogan controversy, Spotify said it would start adding content advisories to episodes discussing COVID-19, and CEO Daniel Ek informed investors that the company has a "sizeable" content moderation team in place.
"We have taken action on more than 20,000 podcasts since the start of the pandemic," Ek told Reuters. "So that tells you something about the scale of this operation. It's truly a global operation."
During a conference call, Ek acknowledged the Rogan issue and said the podcaster, who attracts an estimated 11m listeners per episode, would have to abide by policies developed in conjunction with medical and scientific experts.
(Picture: Spotify CEO Daniel Ek. Photo: Toru Yamanaka/AFP via Getty Images)
