Continued at-home listening of music and podcasts helped Spotify Technology SA post another quarter of strong subscription gains, though overall user growth softened as some of the company’s newest markets face a fierce resurgence of Covid-19.
Streaming content boomed during the pandemic as homebound consumers turned to screens and smart speakers for entertainment. Spotify executives have cautioned that uncertainty lies ahead, however, as the markets it is relying on for growth endure pandemic spikes and listeners in more established markets emerge from lockdowns.
Shares in the company were trading 10% lower Wednesday morning.
“The world isn’t even. In some parts, we’re seeing recovery much faster than others,” said Spotify Chief Executive Daniel Ek. India and Brazil, markets the company has targeted for huge growth, “are still clearly hit,” he said.
For the quarter ended March 31, Spotify reported 356 million monthly active users, up 24% from a year earlier and at the low end of the company’s guidance. Paying subscribers, its most lucrative type of customer, grew to 158 million, up 21% from the same period a year ago and at the top of the range of expectations.