Pandora Media (P) was surging in after-hours trading Thursday as the largest online radio service reported a first-quarter loss that was less than analysts had expected.
Shares of the Oakland, Calif., company were rising 11% in after-market trading on a stock that closed the day at $9.43.
Pandora, which tailors its radio song list to a listener's personal tastes, needed to show investors that the company can extract more revenue out of its more than 80 million average monthly listeners and that new features such as Ticketfly, the concert promotion service it acquired in October, are sufficient to retain market share in the face of advances by Apple(AAPL) - Get Report Music and privately held Spotify.
In a sign of improving fundamentals, Pandora reported a loss of 20 cents per share, less than the average 32-cent loss anticipated by 27 analysts surveyed by Bloomberg. Earnings before interest, taxes and other exclusions were negative $57.4 million, once again less than the negative $68 million that had been expected.
Revenue was $297 million, beating the $285 million average forecast. Pandora also boosted its second-quarter estimate to a range of $345 million to $355 million.
As for total active listeners, a closely watched metric among music streaming services, Pandora said it had 79.4 million active listeners in the quarter, slightly higher than the 79.2 million during the same period a year earlier. Nonetheless, active listenership stood at 81.1 million at the end of 2015.
The results come a little over a month since co-founder Tim Westergren took over as CEO in March, aiming to bolster operations for a stock that has fallen 48% over the past 12 months.
While Pandora grew quickly in the early 2010s, the service has been on the defensive since Apple Music became available to users of iTunes software in June 2015. The December decision by the Copyright Royalty Board established higher fees even as it removed an uncertainty that had hung over the stock throughout 2014 and much of last year.
As losses have mounted, Pandora explored a sale of the company, hiring Morgan Stanley to shop the online radio service to prospective buyers, Bloomberg reported in February.
Heightening the pressure, Spotify last month raised $1 billion in convertible debt from investors including private equity firm TPG Capital and hedge fund Dragoneer Investment Group, Bloomberg reported, citing people familiar with the matter.