Spotify’s subscriber base grew 10% this quarter, but the company is still hemorrhaging money.
On a recent call with investors, Spotify announced that it reached 83 million paid subscribers (an 8 million increase from last quarter), which brings the streaming service’s total subscriber base to 180 million. Although Spotify has more than double Apple Music’s paid subscriber count, which is around 40 million, both companies’ numbers are always somewhat inflated by family plans (where each person on just one account is counted) and promotional pushes (e.g, Spotify’s subscription bundle with Hulu).
User numbers aside, Spotify posted a significant loss this quarter of €394 million, compared to a loss of just €188 million a year ago. Much of Spotify’s spending goes toward expensive licensing deals. Despite that financial strain, Spotify CEO Daniel Ek shot down rumors that the company would start bypassing labels and strike licensing deals with artists directly.
“There’s been some confusion regarding our intention and, for us, it’s about bringing the largest number of creators to our platform,” Ek said. “Licensing content doesn’t make us a label nor do we have any interest in becoming a label.”
Spotify has reported net losses every year since launching 10 years ago. But Ek has made it clear that he is making growth a priority over profit for the time being.