Shares of Spotify Technology SA tumbled on Wednesday after the music streaming service — roiled in controversy over its star podcaster Joe Rogan — projected lower profit margins in the coming earnings period as subscriber growth slows.
The company reported solid increases in the fourth quarter in terms of monthly active users and 180 million premium subscribers, in line with earlier forecasts.
However, the streaming service forecast its first-quarter gross profit margin this year would fall to 25 percent from 26.5 percent, and it projected adding just 3 million premium subscribers in that period, a marked slowdown from recent quarters.
Over the last week, Spotify has been hit with the defection of several music superstars including Neil Young and Joni Mitchell over its handling of Rogan’s controversial statements on COVID-19 vaccines.
Executives nevertheless touted the platform’s long-term growth potential and broadly defended their handling of the Rogan controversy, adding that it was too soon to know how it would affect the company’s financial performance.
Spotify shares fell 10.9 percent to US$171.00 in after-hours trading. The stock has fallen sharply steeply over the last year, along with other “stay-at-home” stocks that benefited from the disruptions to daily life caused by the COVID-19 pandemic.
The company reported a quarterly loss of 39 million euros (US$44.1 million) as revenues increased 24 percent to 2.7 billion euros.
Spotify pointed to “continued momentum in our subscription business and meaningful advertising results,” adding that “we see a tremendous amount of greenfield on the horizon.”
Spotify’s press release made no mention of the Rogan controversy, while emphasizing that consumption trends on the podcasting platform “remained strong.”
On Sunday, chief executive Daniel Ek announced that Spotify would add a content advisory to any podcast that discusses COVID-19, directing users to government health authorities and other trusted sources.
The move followed criticism from Young and other artists who left the platform after a call from medical professionals to prevent Rogan from promoting “several falsehoods about COVID-19 vaccines.”
On Wednesday, Young’s former bandmates from Crosby, Stills, Nash and Young said they had asked their labels to remove their recordings from Spotify.
Ek addressed the matter in opening remarks and again in response to repeated questions from analysts.
While saying Spotify could have articulated its policy sooner, Ek said he was pleased with how the company responded.
“We’re trying to balance creative expression with the safety of our users,” Ek said. “We don’t change our policies based on one creator nor do we change it based on any media cycle, or call from anyone else,” he said. “Our policies have been carefully written with the input from numbers of internal and external experts in this space.”
Ek said it was “too early” to gauge the impact of the Rogan controversy on his business, adding “usually when we’ve had controversies in the past, those are measured in months and not days.”
In Italy’s storied gold-making hubs, jewelers are reworking their designs to trim gold content as they race to blunt the effect of record prices and appeal to shoppers watching their budgets. Gold prices hit a record high on Thursday, surging near US$5,600 an ounce, more than double a year ago as geopolitical concerns and jitters over trade pushed investors toward the safe-haven asset. The rally is putting undue pressure on small artisans as they face mounting demands from customers, including international brands, to produce cheaper items, from signature pieces to wedding rings, according to interviews with four independent jewelers in Italy’s main
Japanese Prime Minister Sanae Takaichi has talked up the benefits of a weaker yen in a campaign speech, adopting a tone at odds with her finance ministry, which has refused to rule out any options to counter excessive foreign exchange volatility. Takaichi later softened her stance, saying she did not have a preference for the yen’s direction. “People say the weak yen is bad right now, but for export industries, it’s a major opportunity,” Takaichi said on Saturday at a rally for Liberal Democratic Party candidate Daishiro Yamagiwa in Kanagawa Prefecture ahead of a snap election on Sunday. “Whether it’s selling food or
CONCERNS: Tech companies investing in AI businesses that purchase their products have raised questions among investors that they are artificially propping up demand Nvidia Corp chief executive officer Jensen Huang (黃仁勳) on Saturday said that the company would be participating in OpenAI’s latest funding round, describing it as potentially “the largest investment we’ve ever made.” “We will invest a great deal of money,” Huang told reporters while visiting Taipei. “I believe in OpenAI. The work that they do is incredible. They’re one of the most consequential companies of our time.” Huang did not say exactly how much Nvidia might contribute, but described the investment as “huge.” “Let Sam announce how much he’s going to raise — it’s for him to decide,” Huang said, referring to OpenAI
Nvidia Corp’s negotiations to invest as much as US$100 billion in OpenAI have broken down, the Wall Street Journal (WSJ) reported, exposing a potential rift between two of the most powerful companies in the artificial intelligence (AI) industry. The discussions stalled after some inside Nvidia expressed concerns about the transaction, the WSJ reported, citing unidentified people familiar with the deliberations. OpenAI makes the popular chatbot ChatGPT, while Nvidia dominates the market for AI processors that help develop such software. The companies announced the agreement in September last year, saying at the time that they had signed a letter of intent for a strategic
RSS