Spotify finally made a profit and spent a lot on his future podcast



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In its fourth quarter profit, the company recorded 207 million monthly active users, up from 191 million in the last quarter. Premium subscribers rose from 87 million to 96 million, while ad-supported listeners increased from 109 million to 116 million. In comparison, Spotify had 71 million premium users and 93 "free" listeners at the same point last year. These numbers helped the company release a healthy revenue of € 1.5 billion (approximately $ 1.7 billion) and, for the first time, a quarterly operating profit of € 94 million (approximately $ 107 million). This is a dramatic balance of the € 87 million (approximately $ 99 million) loss reported at the end of the fourth quarter of 2017.

Spotify attributes the new users, in part, to its expansion in mid-November, which included 13 countries in the Middle East and North Africa. "Performance so far has exceeded our initial expectations and we hope to seize this moment in 2019," the company said in its results.

Spotify already offers podcasts and has been producing original shows for some time. The company is not satisfied with their offers, however. In addition to Gimlet and Anchor, executives expect to spend between $ 400 million and $ 500 million "on multiple acquisitions" this year. "The growing audience podcast at Spotify is an important strategy to drive funnel growth, increase user engagement, reduce churn, accelerate revenue growth and increase margins," the company said in its earnings statement. "We intend to lean towards this strategy in 2019, both to acquire unique content and to increase investment in content production internally."

Spotify is taking the Netflix model, in short. As the company grows, it is inevitable that established labels will start charging higher licensing fees. Podcasts, however, is something that Spotify can buy and own as unique content. If the green light is displayed to the right, this may deter users from third-party podcast applications and persuade them to slowly make a premium subscription. The anchor also gives Spotify the potential to quickly build a YouTube-style distribution network. "Gimlet and Anchor will position us to be the premier platform for podcast creators around the world and the leading producer of podcasts," Ek said in a blog post.

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