Spotify’s paid subscribers now number 87 million, tipped to hit 97 million by end of year

Spotify’s third quarter financial postings showed that it is slowly but slowly turning users into paying ones.

Its subscriber tally is now 87 million at the end of September, with the company expecting hit to grow to 93—96 million by the end of the year, with monthly active users (MAUs) to reach between 199—206 million by then from the current 109 million.

Breaking down the figures, the extra 4 million subscribers that came on board in Q3 was half of the take-up during Q2.

This is despite some aggressive recent price promotions, including the giveaway of 60 days of Premium access for free in territories including Australia, the US and the UK.

The growth of MAUs represented an 8% rise during the third quarter, or 20% year-on-year.

Spotify attributes this to updates n its interface, but also warned the market that there are “fake users” on its platform.

Total revenue for the quarter was €1.352 billion (A$2.14 billion), an increase of 31% year-over-year and 6 % from the last quarter.

The vast majority of revenue came from premium subscribers (€1.21 billion or $1.91 billion) while ad-supported revenue totalled €142 million ($224.8 million) in Q3, an increase of 16% since the last quarter.

Spotify said in report: “Growth continues to be healthy across our Family and Student plans, and the strong retention characteristics of this base continue to drive churn lower.”

The streaming service is projecting anywhere between €1.35— €1.55 billion ($2.13— $2.45 billion) in total revenue in Q4.

Gross profits were €342 million ($541.6 million), while the operating loss narrowed to €6 million ($9.5 milion) – a 92% year-on-year reduction.

CEO Daniel Ek noted that Spotify For Artists now has 250,000 regular users from the self-releasing community, and saw it as a place of future growth.

International expansion is another but Ek admitted its attempted launch in India has been slower than anticipated.

“India is a very fragmented marketplace,” he said. “[But] there is nothing we see that prevents us launching in India.”