Spotify Technology (SPOT) shares jumped after the digital-music major reported a smaller-than-expected first-quarter loss.
The loss at the Luxembourg company totaled 0.2 euro (US$0.22) a share, shrinking from 0.79 euro in the year-earlier quarter. The latest figure also was narrower than the 0.47 euro loss analysts surveyed by FactSet forecast for the quarter.
Revenue totaled 1.85 billion euros in the latest quarter, up 23% from 1.51 billion euros a year earlier but a tad below analysts’ prediction of 1.86 billion euros.
The coronavirus pandemic hurt Spotify.
“Beginning in late February, we saw some impact to our business,” the company said in a statement.
“While [monthly active users] and subscribers remained in line with our forecast and held steady, in hard-hit markets like Italy and Spain, we saw a notable decline in daily active users and consumption.”
But “over the last few weeks, we’ve seen listening start to rebound, and in many markets, consumption has meaningfully recovered,” the company said.
Spotify garnered 286 million MAUs in the quarter, beating the 283 million projected by analysts.
“Listening time around activities like cooking, doing chores, family time, and relaxing at home have each been up double digits over the past few weeks," the company said.
Still, “we have taken steps to slow hiring for the remaining three quarters of 2020 and have reduced open headcount by roughly 30% from prior growth expectations.”
Spotify shares recently traded at $156.48, up 12%.
The stock has gained 10% over the past three months, compared with an 11% drop for the S&P 500.