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Spotify: Listening habits during the pandemic make every day look like the weekend

Spotify announced its Q1 2020 financial and user metrics today. While the company’s quarterly numbers looked healthy for the most part, what was perhaps most interesting was how listening habits have evolved during the COVID-19 crisis, with games console and connected device consumption up, and morning listening routines transforming as millions of people have been forced to hunker down behind closed doors. As Spotify put it, “every day now looks like the weekend.”

The company revealed that it grew its total monthly active users (MAUs) to 286 million — up 31% and 5% on the previous year and quarter respectively. More specifically, paid premium subscribers hit 130 million, a year-on-year (YoY) increase of 31% and quarter-on-quarter (QoQ) increase of 5%, meaning that the company has maintained its roughly 45% ratio of paid to ad-supported users.

In terms of financials, Spotify reported revenue of €1.85 billion ($2 billion), up 22% on last year while remaining static compared to the previous quarter. The company returned an operating loss of €17 million ($18 million), compared to losses of €47 million ($51 million) last year and €77 million ($84 million) for Q4 2019.

Above: Spotify’s Q1 2020 numbers

The pandemic effect

In some of its markets that have been hit worse by the pandemic, including Italy and Spain, Spotify said that overall daily active users and consumption declined — however, the company said that listening habits have started to bounce back, while “consumption has meaningfully recovered” in many markets.

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Moreover, where consumption was declining, a reasonable assumption would be that its MAUs and paid subscribers would decline too, but it seems that the opposite was the case. “Both new and reactivated MAUs grew substantially, even during lockdown periods in major markets,” the company wrote in its earnings report.

While there was no major unexpected metric in Spotify’s Q1 2020 financials, with users and subscribers sitting roughly in line with forecasts, digging down into the numbers reveals some interesting trends. For example, listening via wearables, cars, and web-based platforms dropped by “double digits” in some cases, while consumption through TV and games consoles grew by more than 50% over the same period. For ad-supported “free” users in the U.S. specifically, Spotify said that games consoles represented a “top 2 or 3” platform for consumption for the past month. More generally, connected device usage grew by more than 40% among ad-Supported users in all Spotify markets.

And this is what Spotify means when it says that “every day now looks like the weekend”: instead of commuting to work, people are sitting at home in their bedrooms and lounges day in, day out, making each day indiscernible from the previous. Perhaps notably, Spotify said that this trend was more pronounced in podcasts than music, which the company attributes to “car and commute” habits that have changed significantly over the past two months. Spotify said that 19% of its monthly users now “engage with podcast content,” up from 16% in the previous quarter. Separately, Spotify said that it has seen a spike in podcast consumption related to meditation and wellbeing, while searches for relaxing music covering “chill” and “instrumental” have also increased.

Elsewhere in the digital media realm, Netflix more than doubled its own Q1 2020 subscriber expectations, gaining 15.8 million new paying customers compared to the 7 million it had projected.

It’s clear to see how people are keeping themselves amused during lockdown.


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