Spotify Not the Paul Vogel you were looking for? As such, if Spotify is able to acquire customers that are valuable in the long-term (i.e., have a high customer lifetime value), it makes sense to be more aggressive with S&M investments to gain market share and strengthen their MAU lead over competitors like Apple (AAPL) and Amazon (NASDAQ:AMZN). $73,192. Spotify (NYSE:SPOT) is the largest global audio streaming platform with 456m monthly active users (MAUs) and 195m premium subscribers. Despite Spotify's market leadership position and immense scale with 456m MAUs, they have struggled to generate consistent operating profits. I mean its early days on audio books. Moreover, free cash flow is projected to become negative on a one-off basis in Q4 due to the timing associated with cash receipts between quarters. Still early days in terms of how it's impacted at this point. Thanks, Daniel, and thanks, everyone, for joining us. Well, we do a lot of experiments on the product side in many different areas. In Q3, Spotify reported 20% YoY growth in total MAUs from 381m to 456m (vs. guidance of 450m) and 13% YoY growth in premium subscribers from 172m to 195m (vs. guidance of 194m). And there wasn't really any specific area. We've seen podcast MAU as a percent of our total MAU continue to increase. And then podcast consumption per podcast MAU is also up year-on-year. And then last point I would just add is to say that structurally, as the revenue mix shifts to more and more non-music content, so both podcasting but also audiobooks, et cetera, those gross margins in those categories is going to be significantly higher than the ones we've had in the music business, too. Vogel, who was interviewed byCharles Kane,a senior lecturer in Global Economics and Management at MIT Sloan, described how Spotify experimented with its service offerings before settling on a freemium subscription model. To ensure this doesnt happen in the future, please enable Javascript and cookies in your browser. We're also forecasting EUR 3.1 billion in total revenue, a gross margin of roughly 25%, excluding severance charges and an operating loss of EUR 194 million with the latter reflecting EUR 35 million to EUR 45 million in severance charges within our operating expenses. And I'll let Paul fill in on more of the specific details. Ive got 10yrs experience. A lot is things that we test and learn. The join flow is better, giving users the choice on payment methods and how they want to work with us and purchase from us. Heres who they are and what the highest paid make, Police: Stay away from MN State Fairgrounds during emergency response training. So, it was broad-based globally. However, such a slowdown in ad-supported revenue is not isolated to Spotify but is rather a function of weakening macroeconomic conditions. Spotify have hired their new Chief Financial Officer, plucking from their existing team someone they trust. Another question for Ben Black on ticketing. There was outperformance in pretty much every region. In 2021, we said that 2022 would be an investment year, and it was. So, we do expect that Q1 will be the low point for gross margin, and we do expect for it to improve throughout the year, with hopefully a nice trajectory heading out of 2023. Long term, I think it's absolutely a business model and market opportunity for Spotify, too. Since then, the Swedish company has watched its number of subscribers tick past 400 million as it expands into podcasting, live audio, and audio books. WebIncludes base and annual incentives. And the number of users on our platform that are consuming, podcast keeps growing as well. State says changes needed. We've talked about the improvements in podcast gross margin as well as we expect that to get better throughout the year. There are 15 older and 11 younger executives at Spotify Technology S.A. And I feel really, really good about our competitive differentiation. We want to have a billion users, Paul Vogel, Spotifys chief financial officer, told attendees at the 19th annual MIT Sloan CFO Summit last month. If not, does this give Spotify increased confidence to take price? And some of them, not surprisingly, haven't worked out. I think we had said at the Investor Day that we expected Marketplace to grow at least 30% in 2022. And this is true across the world, really at this point. And now we're going to have to live up to that. As the Chief Financial Officer of Spotify Technology S.A, the total compensation of Mr Vogel at Spotify Technology S.A is So, I just wanted to add that context that, that's still very much on the top line for us that you should expect music to be meaningfully improving with things like Marketplace playing an important role. Spotify Technology S.A. (NYSE:SPOT) Q4 2022 Results Conference Call January 31, 2023 8:00 AM ET. So even with the strong growth, we're not seeing any uptick in churn at all. So, could you break out -- break down which investments are falling off that will drive the positive gross margin inflection in 2023 and 2024? And are you seeing any conversion uplift? And how far forward do you have insight into demand trends? And as that happening, it is impacting our business. Frederick Melo was once sued by a reader for $2 million but kept on writing. So, speed will come in having more decision-making and faster decision-making. Is audio books as a category working? Indeed, Ek's central thesis for heavily investing to build a multi-product platform is that newer products (e.g., podcasts and audiobooks) do not have the same artificial gross margin constraints as their premium music revenue. So, the short answer is yes. four years ago, we entered into podcasting. Okay. What are some of the concessions you're looking for from the labels? Reported results were aided by a 600-basis point currency benefit. It's still early days. We've got a follow-up question. They're trying to engage more with that audience, and we're obviously trying to help them monetize that audience even better. Spotify