Spotify outperformed on several metrics last quarter
In the fourth quarter of 2018, Spotify’s (SPOT) number of monthly active users rose 29% YoY (year-over-year) to 207 million, higher than its management’s guidance range of 199 million–206 million. Spotify experienced growth across geographies and regions driven by an increase in customer retention.
Emerging markets (EEM), including Latin America, experienced strong growth in the fourth quarter. The company increased its footprint and penetration to 78 countries, up from 65 countries in the previous year’s period. In November 2018, Spotify launched its services in the Middle East and North Africa, and it expects to build on this momentum in 2019.
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In February this year, Spotify officially launched its services in India (INDA).
Over 15 billion hours of content consumed in the fourth quarter
According to Spotify, users consumed or listened to 15 billion hours of content on its platform in the fourth quarter driven by increased user engagement in the ad-supported and Premium verticals.
The company’s number of premium subscribers rose 36% YoY to 96 million at the end of the fourth quarter of 2018—the higher end of the company’s guidance of 93 million–96 million. In the holiday season, Spotify partnered with Google Home (GOOG) (GOOGL), marking the first-ever hardware bundle offering in Spotify’s history.
First-ever positive net income for Spotify
In the fourth quarter of 2018, Spotify reported a positive operating income, net income, and free cash flow for the first time in its history. Its operating margin expanded to 6.3% from -7.6% in the previous year’s period.