Deezer ended Q3 2022 with 9.4 million subscribers, unchanged from the beginning of the period, while Q3 revenue growth gained momentum partly due to the company’s price hikes.
The France-based music streaming platform had 5.6 million B2C subscribers at the end of September and 3.8 million B2B subscribers, both unchanged from end of juneaccording to the company’s third-quarter earnings results released on Thursday (October 27).
On a year-over-year basis in the third quarter, Deezer’s total subscribers fell 2.5% year-over-year from 9.7 million to 9.4 million (see below), a decrease of 15.8 % of B2C subscribers outside of France.
It follows the company’s new strategy of focusing on several key markets.
Deezer, that debut at Euronext Paris in July, reduced investment in non-core markets and refocused efforts towards large attractive markets through a go-to-market partnership model.
It also left the Russian market in the first quarter when the Russia-Ukraine conflict reached its peak, resulting in the loss of 104,000 subscribers in that market alone.
However, Deezer’s operations in his home country of France continue to drive his business. The number of B2C subscribers in France has increased 9.5% YoY reached 3.4 million subscribers as of the end of September.
“While the overall macroeconomic environment remains highly volatile, marked by an increase in inflation, we have seen strong resilience in business activity in the first nine months of 2022. “.
Deezer
“This sustained performance primarily reflects higher family aggregation, continued conversion funnel optimization, as well as improved churn rates, despite rising prices,” Deezer said.
“In the rest of the world, implementing Deezer’s new strategy has resulted in a significant reduction in unprofitable spending in non-core long-tail markets, thus impacting subscriber acquisition. sign new B2C in these markets.”
Deezer
In the rest of the world, implementation of Deezer’s new strategy has resulted in a significant reduction in unprofitable spending in non-core long-tail markets, thus impacting the attracting new B2C subscribers in these markets.”
The strength of Deezer’s domestic operations helped boost the company’s overall revenue by 14% year-on-year to 115.2 million euros ($116 million) in the third quarter.
Consolidated revenue for the first nine months of the year increased 13% year-on-year to €334.6 million ($336.94 million), accelerating from a 12.1% increase in the first half of the year when lost 300,000 subscribers.
Deezer credits the power of double-digit growth across all segments and geographies. The company currently operates in France, Germany, UK, Brazil and USA.
Deezer’s B2C revenue grew 11.6% YoY in the third quarter to 79.8 million euros ($80.35 million) thanks to increased activity levels, mainly due to a 14.8% increase in ARPU. ARPU increased due to rising prices and the company’s lack of focus on select key markets, it said.
B2B revenue, meanwhile, grew 13.2% from a year earlier to 30.5 million euros ($30.7 million), which the company attributed to the strong performance of its relationships. recent partnerships with France’s SFR, Brazil’s Globo and Europe’s A1, and a 16.2% increase in ARPU.
Going forward, Deezer reaffirms its goal of achieving around €455 million in revenue by 2022, up 14% year-on-year.
“While the overall macroeconomic environment remains uncertain, marked by an increase in inflation, we have seen strong resilience in our business in the first nine months of 2022. and we do not expect any significant negative effects on our operations or finances,” Deezer said.
The company has yet to disclose whether it made a profit or loss in the third quarter of the year.
Last month, Deezer commit profitable in 2025 after its losses narrowed by 8.8 million euros in the first half of the year.
Deezer “believes we can get our fair share of the booming streaming market and continue to improve our bottom line to break even by 2025,” said Deezer CEO Jeronimo Folgueira. know at the time.
The company also revealed during its investor day in London on October 4 that expectations sales reach 1 billion euros by 2025.
Deezer has increased the price of the Premium package from £9.99 to £11.99 in the UK in October 2021.
In the US, Premium Deezer subscription price has increased to $10.99 in february.
Price increases have also been seen from things like Apple Music and YouTube in recent weeks.
Apple Music now charge $10.99 for individual Premium plan, while YouTube Long walk The price of the Premium Family Pack is down 28% to $22.99.
Competitor Spotify still charges the classic $9.99 subscription for its Premium plan, but the CEO Daniel Ek tell investors Last week, the company was considering raising prices following similar moves from competitors.
All EUR-USD conversions in this report for Q3 2022 have been taken as common quarterly average rates determined by the European Central Bank.Worldwide music businessWorldwide music business
