Credits: Wikimedia commons

One of the most popular music streaming services in the world, Spotify, has published its financial report for Q3 2020, beating the estimates set by analysts. The platform recorded strong growth in both monthly active users (MAU) and premium subscribers on its platform.

During the quarter ending on September 30, Spotify witnessed an increase of 27% in its paid subscriber base from a year earlier, with 144 million premium users. This number crosses the expectations of the analysts, who had predicted 142.5 million paid users for the platform in Q3. This is huge, as most of Spotify’s revenues comes from premium subscriptions.

The streaming platform amassed 29% more monthly active users than in 2019, and now caters to 320 million MAUs in total, while the analysts had only expected 316 million MAUs for the streaming service in Q3 2020. The total number of ad-supported MAUs for Spotify stands at 185 million after Q3, up by 31% year over year.

Even though Europe and North America are Spotify’s largest markets, it witnessed a much faster growth of MAU in Latin America and the rest of the world, especially in India. The company credits successful marketing campaigns in these regions for the growth.

Spotify in its report stated, “From a content consumption standpoint, global consumption hours surpassed pre-COVID levels during the quarter, and all regions have fully recovered. Consumption trends by the platform have returned to normal usage, including in-car listening hours which is now above the pre-COVID peak. Usage on connected devices inside the home, which saw a spike during the lockdown, also remains above pre-COVID levels.”

Revenue figures for Spotify look good too, as the company reports 1.98 billion Euros in revenues in Q3. The company’s total revenue has increased by 14% from last year, when it reported 1.89 billion Euros in revenues. Of the total revenue, Spotify’s premium subscription contributes the largest amount with 1.79 billion Euros. The other 180 million Euros comes from Spotify’s ad-supported user base. The company earned 489 million Euros in gross profits in the third quarter, up by 11% year over year.

“The rebound was led by our Podcast and Ad Studio channels, which grew in the strong double digit range on a Y/Y basis. Notably, the recent rollout of video in Ad Studio exceeded expectations and post Q3, Ad Studio was rolled out for the first time ever in non-English language markets,” reads Spotify’s Q3 financial report.

For the ongoing fourth quarter, Spotify predicts that its MAUs will rise to 340-345 million. The streaming giant says that due to the effects of the COVID-19 pandemic,  there won’t be any significant rise in numbers but it still expects its total premium subscribers to rise to 150-154 million users , predicting  2-2.2 billion Euros in revenue in Q4 2020.