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Pandora Stock Soared on Earnings Beat

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Pandora reported revenue of $319.2 million in 1Q18

Pandora (P) stock rose almost 26% in the week ended May 4 to close at $6.89. Pandora stock continued to rise over 4% on May 7, and the stock has now generated returns of -33% in the last 12 months and 50% in the last one month after falling 63% in 2017. Pandora is trading 75% above its 52-week low of $4.09 and 34% below its 52-week high of $10.79.

Pandora’s stock price rose almost 20% on May 4 after the firm announced its 1Q18 results that day. Pandora reported revenue of $319.2 million in 1Q18, a rise of 1% YoY (year-over-year) and higher than its guidance of revenue between $295 million and $305 million.

Non-GAAP (generally accepted accounting principles) EPS (earnings per share) were -$0.27, which was above analyst estimates of -$0.38.

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Revenue impacted by Ticketfly sales

Pandora’s revenue growth was 12% YoY in 1Q18 after adjusting for the sale of Ticketfly and the closure of the company’s ANZ (Australia/ New Zealand) business. The number of paid subscribers for Pandora’s subscription services such as Pandora Premium and Pandora Plus rose 19% YoY. The total number of subscribers for Pandora now stands at 5.6 million. While Pandora Plus costs $4.99 per month, Pandora Premium costs $9.99 per month.

Total subscription revenue for Pandora rose 63% YoY to $104.7 million, while advertising revenue fell 3% to $214.6 million in the quarter ended March 2018.

Pandora has estimated revenue between $360 million and $375 million in 2Q18, which indicates YoY revenue growth of 7% after adjusting for Ticketfly sales and the exit from ANZ markets.

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