Shares of Spotify (SPOT) are down 5% after the audio streaming company reported financial results that missed Wall Street’s expectations across the board.
The Swedish company known for its music and podcasts reported earnings per share of 2.61 euros ($3.01 U.S.), which missed analysts’ consensus forecast of €2.76.
Revenue in the year’s second quarter totaled €4.78 billion, which fell short of the €4.79 billion expected on Wall Street. Sales were up 14% from a year earlier.
Despite the disappointing print, Spotify said that it added seven million premium subscribers from a year ago over, reaching the milestone of 300 million premium subscribers.
Total monthly active users on the platform rose 12% year-over-year to 777 million. That figure includes premium subscribers and subscribers on the ad-supported version of Spotify.
Management blamed higher costs for the poor quarterly results. Operating expenses rose 3% from a year earlier to €941 million as Spotify poured more money into marketing.
The company also spent more on cloud computing and artificial intelligence (A.I.) technologies.
In terms of guidance, Spotify said that it expects operating income of €670 million and revenue of €5 billion for the current third quarter of the year.
Wall Street analysts had operating income of €678 million and revenue of €4.93 billion penciled in for the company.
Spotify has raised prices for its audio streaming platform several times in recent years, which some analysts have said might be curtailing the company’s growth.
Before today (Aug. 4), SPOT stock had declined 26% over the past 12 months to trade at $486.33 U.S. per share in New York.
