Deezer lost new subs after it stopped “unprofitable spend in non-core, long-tail markets.”
Deezer logo displayed on a phone and headphones are seen in this illustration photo taken in Krakow, Poland on Aug. 22, 2022.With a newfound focus on a small number of lucrative, established markets, music streaming company Deezer reported revenue of 219 million euros in the first half of 2022, up 12.1% as reported versus the prior-year period.
The Paris-based company received 132.4 million euros , or 60.3% of its revenue, in its home country of France, up 11.1% year-over-year. Revenue from the rest of the world improved to 87 million euros , up 13.6% from the prior-year period, and accounted for 39.7% of revenue, up from 39.1% a year ago. In Brazil, Deezer’s second-largest market, revenues improved 25% at constant currency. Other revenue — advertising and ancillary revenue — grew 58.3% to 6.
Deezer’s focus on more substantial markets, however, along with price increases, helped its B2C average revenue per user grow 13.2% to 4.6 euros . B2B ARPU improved 7.2% to 2.5 euros , helping compensate for the loss of 100,000 B2B subscribers. Unlike peers such as Spotify, which originally focused on established markets in Europe and North America, early on Deezer aimed to build its businesses with a larger global footprint. By 2013, the service operated in more than 180 markets, including many small countries in Africa and Asia. Today, its efforts are focused on a smaller number of established markets that numerous music executives believe are far from saturated.
“With a highly competitive product, a clear strategy, a renewed and experienced management team, supported by a strong new Board of Directors, I am very confident that we are now perfectly positioned to accelerate our growth, and deliver substantial value for all our stakeholders,” chief executiveDeezer second-half guidance of 455 million euros , which would be 14% annual growth. It expects the launch of the RTL+ Music app in Germany to accelerate B2B growth in the second half of the year.
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