Spotify lost $188 million in 2015

by Richard Howard

May 27, 2016

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Spotify has lost nearly $700 million since 2008. Its average employee salary? $168,747.

To anyone paying attention, Spotify’s finances remain more confusing than the success of Rebecca Black’s musical monstrosity ‘Friday.’ Here’s a streaming platform that’s immensely popular with users and whose estimated value of $8.4 billion was higher than that of America’s entire music industry, yet has operated at a loss for pretty much every second it’s existed. However, new numbers released have clarified that the situation isn’t so much ‘confusing’ as it is totally batshit crazy.

The fact that the company posted losses of $188.7 million in 2015 is astounding enough, but the truly unbelievable figure is how much they’ve lost over time.

If you’re not feeling in an arithmetic type mood, we’ll add it up for you. Spotify has cumulatively lost an insane $698.1 million since its inception in 2008. There’s eight countries whose entire GDP is less than that. So….what the hell? Well, the math actually ads up pretty easily. While Spotify boasts about 100 million users, less than one-third of them are paying subscribers. A marked improvement over 2014, their total revenue was $2.12 billion last year, but this still couldn’t pull them out of the hole.
In addition to $1.56 billion in debts, the company claimed $1.82 billion in royalty payouts (which continue to go mostly to labels instead of artists), which begs the question: is there any way streaming music can become a sustainable model? While the short answer seems to be ‘clearly not,’ you’ve got to wonder if Spotify knows something we don’t, since financial filings have shown the average employee salary in 2015 has shot up 152% since 2010 to $168,747.

Tags: Tech, News, 698 million, losses, Spotify

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