Spotify is not making a profit yet

Music streaming service Spotify again failed to make a profit in 2013. The turnover made by the streaming service increased by 73.6 percent, but the operating loss made by the streaming service also increased.

In 2012, Spotify still achieved a turnover of 430.3 million euros; last year it was 746.9 million euros, an increase of 73.6 percent, writes The Guardian based on the results. However, the operating loss, before interest and taxes, also increased. In 2012, this amounted to ‘only’ 80 million euros; last year it was 93.1 million euros.

The net loss did decrease – from 86.7 million euros to 57.8 million euros – but that was largely due to audit measures. Incidentally, some individual, local Spotify branches did make a profit last year. It is not known whether Spotify is still losing money; since last year, Spotify has gained 14 million users, bringing the number of users to 50 million.

Spotify generated the most revenue with subscriptions: 90.9 percent of this came from the paid version of the streaming service. That while only 22.2 percent of users pay for Spotify. The rest use the ad-driven Spotify variant, but the service thus earns relatively little money. Earlier, Spotify CEO Daniel Ek indicated that the free variant is necessary to introduce users to Spotify.