Business

Latin America sees second fastest growing in Spotify users

The company has reached 138 million global subscribers as music streaming demand has rebounded from coronavirus-related weakness

LABS

29.Jul.2020 09:28 BRT
UPDATED 10:16 BRT

Latin America registered, on June 30, 66.8 million Latin American users and 29 million paid subscribers;
Global paid subscribers reached 138 million, after an increase of 13%;
In April, in-car listening declined by 50%, but at the end of the quarter such habit had rebounded to less than 10% below pre-COVID levels.

Latin America continues to see the second-fastest growth in Spotify‘s monthly active users, with the region growing 33% in the second quarter of 2020 year on year, following only what the company labels “Rest of World”, which encompasses Asia-Pacific, Middle East and Africa and registered an increase of 56% in the same period.

Latin America registered, on June 30, 66.8 million Latin American users, or 22% of its global base, of which 29 million are paid subscribers – in both figures, the region is behind only Europe and North America, which account for 34% and 26% of total Spotify users, respectively.

“Parts of Latin America and Rest of World saw slower than expected growth in April and May as we saw lower intake, an increase in churn, and increases in payment failures from our Premium users. Encouragingly, things rebounded significantly in June as we saw increased reactivations and a step down in churn”, said the company in a statement for investors.

In a presentation on its quarterly results, Spotify, the world’s largest audio-streaming service, said music streaming demand has rebounded from coronavirus-related weakness at the start of the quarter and its paid subscribers reached 138 million. Of those, over a fifth (21%) are Latin American subscribers.

Spotify distribution of is subscription base at the end of the second quarter of 2020. Source: Spotify

However, total revenues missed analysts’ estimates of €1.93 billion. It rose 13%, to €1.89 billion, but was hit mostly by a 21% fall in ads as the spread of the pandemic kept advertisers at bay.

Consumption decreased and then recovered

“We noted last quarter that we began to see a modest impact on consumption hour trends driven by Covid. As of June 30, global consumption hours have recovered to pre-COVID levels. All regions have fully recovered with the exception of Latin America which is approximately 6% below peak levels prior to the global health crisis”, said the company.

Consumption of the company’s streaming services was affected in the first weeks of the pandemic, as people reduced the amount of time listening to the platform while commuting to work. In April, in-car listening declined by 50%, but at the end of the quarter such habit had rebounded to less than 10% below pre-COVID levels.