Spotify beats profit expectations as subscribers hit 158 million

Swedish music streaming giant Spotify has posted a rare net profit in the first quarter, as a recent drop in its share price lessened the burden of employee compensation.

In the first three months of the year, Spotify moved into the black with a small net profit of 23 million euros ($27.8 million), while revenue rose 16 percent year-on-year to 2.15 billion euros ($2.6 billion), the company said in its quarterly report on Wednesday.

At the end of March, the number of monthly active users reached a total of 356 million, with the number of paying subscribers up by 21 percent to 158 million.

Podcast business

Analysts on average were expecting the company to have 157.5 million paid subscribers, according to IBES data from Refinitiv.

Spotify, which launched its services in 86 new countries in the quarter, said growth in the United States, Mexico, Russia, and India offset lower-than-expected growth in Latin America and Europe.

The world's most popular paid music streaming service, which has been boosting its podcast business, on Tuesday launched a paid subscription platform for podcasters to challenge a similar service unveiled by Apple.