NEW YORK (TheStreet) -- Pandora (P) shares are plummeting, down -15% to $23.96 on Friday, following the release of the company's first quarter earnings report.
Despite posting positive revenue estimates that beat analysts estimates by $5 million, and earnings that beat Wall Street estimates by 1 cent, the company's shares have taken a dip due to disappointing second quarter guidance.
The company lowered its guidance for the current quarter to between break even and 3 cents per share, falling short of analysts consensus 5 cents per share estimate.
The company reported a first quarter 69% increase in marketing spending to $61.9 million, while the cost of the content the internet radio service broadcasts increased by 26%.
Pandora is currently embroiled in a copyright infringement lawsuit brought by several major record labels, including Sony Music (SNE), Universal Music (VIV) and Warner Music (TWX), who accuse the company of failing to pay for content produced before 1972.