Spotify Technology SA (NYSE:SPOT)’s US-listed shares fell premarket as the streaming giant reported a miss for both revenue and earnings for the second quarter.
The Stockholm, Sweden-based company posted a loss of €0.42 per share, compared to earnings per share (EPS) of €1.37 in the year-ago period and far below Wall Street estimates of EPS of €1.97.
Operating income of €406 million missed the company’s guidance of €539 million and Street estimates of €490 million.
The company attributed the miss to higher personnel costs and professional services and marketing expenses.
Revenue of €4.19 billion, up 10% year-over-year, missed estimates of €4.26 billion. This was below Spotify’s guidance of €4.3 billion.
Spotify said that unfavorable currency movements impacted revenue growth by 440 basis points year-over-year, compared to the 170 basis points incorporated in their guidance.
A bright spot was subscriber growth. Total Monthly Active Users (MAUs) were up 11% year-over-year at 696 million, above guidance of 689 million.
Premium Subscribers were up 12% at 276 million and Ad-Supports MAUs were up 10% at 433 million.
Spotify’s Q3 guidance also weighed on the stock. The company said it expects revenue of €4.2 billion, below estimates of €4.48 billion and operating income of €485 million, short of the consensus €562 million.
“Overall, we continue to view the business as well-positioned to deliver growth and improving margins in 2025 as we reinvest to support our long-term potential,” the company said.
Spotify’s NYSE-listed stock traded down 7.3% at about US$650 before markets opened on Tuesday.