Pandora eyes deals with tech giants as smart speaker users increase by 282%

Pandora’s plans to turn its fortunes around include astrategy todeepen its current relationships with Sonos, Google and Amazon, as figures show that that a rapidly growing rate of users are using a voice activated device, like Amazon’s Echo Alphabet Inc.’s Google Home, to listen to it.

The music streaming service’s second quarter earnings report last week showed that smart speaker use on the platform has increased by 282% from a year ago, notching up 1.6 million listeners out of its total of 76 million.

Pandora will also strike new partnerships in order to expand its suite of connected devices, which now number more than 2,000 according to Pandora’s Chief Financial Officer and interim CEO, Naveen Chopra.

This will most likely include Apple’s HomePod voice-activated device, which is dueto launch soonin Australia, the UK and the UK, in the first part of a global rollout.

Despite a turbulent few months which saw Pandora completely close down itsoperations in Australia and New Zealand, the company has seen positive growth.

The second quarter results beat Wall Street’s expectations, as the company refocussed on growing audience numbers from a broader base than promoting its subscription offers.

Revenues were up 10% to $376.8 million to analyst predictions of $368 million, and a per-share basis loss of $0.21 to anticipated $0.24.

While subscription revenue was 25% to $68.9 million with 4.9 million paying subscribers, active users fell from 78.1 million in the second quarter of 2016 to the current 76 million, a drop of 2.7% year-on-year.

Chopra points out that this drop actually showed a slower rate of user loss than in the past, also noting that the level of user engagement and ad business rose in the second quarter.

He said, “This quarter’s results are a great example of our ability to generate more value from our ad-supported audience even while listenership levels may not be growing.

“Going forward, we expect the trends in our advertising business to continually improve.”

Voice-activated speaker devices – which allow users the convenience of requesting a song, artist, or an activity ormood-enhancingtrack by voice activation – and car interfaces are described as a “natural fit: for a service like Pandora and could be key elements in its turnaround.

Consumer and retail research analysts company Technavio last month forecasted that the US smart speaker market would grow at a CAGR of more than 38% between 2017 and 2021.

The growth is fuelled by the increase in the buying power of tech-savvy millennials who use at least three devices a day, innovations in features and user interface, and a greater adoption of connected devices which will see 70 million homes in North America and Europe being “smart” by 2020.