During their Q2 earnings call on July 27, Spotify CEO Daniel Ek offered encouraging news about the streaming service's performance, which seemed to be unaffected by a potentially pending recession.
During the call, Spotify CFO Paul Vogel reported that the streaming services' "total monthly active users grew to 433 million in q2." This is good news considering that Spotify suspended its services in Russia in March 2022, citing new legislation that would punish media outlets with up to 15 years in prison for those who report what the Russian government deems to be fake news about its military.
Despite this closure, the growth in active users grew 19% year-over-year which the company attributes to an increase in Gen Z usage in Latin America, account reactivations in Europe and their added investments in marketing campaigns.
Paid subscribers growth also increased 14% year-over-year to 188 million and Spotify's goal is to add approximately 17 million new monthly active users in the third quarter, with an increase of paid subscribers to 194 million.
"We're confident in our ambitions to get to 1 billion users by 2030," added Ek. "It's hard to be anything but optimistic given what I'm currently seeing. Looking further ahead, recession or not my confidence in our business and the unique Spotify machine that we're building is really unwavering."
"Audio is growing, and Spotify with it," noted Eck. Explaining that Spotify's business model is one that is "powered by three revenue-generating business models: subscriptions, ads, and marketplace," Eck subtly hinted at a future Spotify investment.
When asked by an investor "How are we driving awareness and what's been the early willingness of artists and fans to want to sell and buy live experiences via Spotify?" Ek hedged, responding, "I would just really kind of say it's early days, on experimentation, on our live initiatives, both these sort of physical and digital ones."
In actuality, Spotify announced two weeks after the call the launch of a Spotify ticketing service. Though only currently selling seven shows in smaller venues across the U.S., Ek noted during the investors' call that bigger things are to come.
"Multiple business models with multiple verticals into one user experience is what we will continue to invest in," said Ek. "Not only will this investment benefit Spotify and its shareholder, but it also creates tremendous upside for listeners, artists, songwriters, creators and advertisers."
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