Deezer’s revenues grew 6.2% YoY in Q1, but its total subscribers fell 2.1% to 9.3m

France-born music streaming service Deezer has published its financial results for Q1 2023 (ended on March 31, 2023).

The company reports that its consolidated revenues, which includes revenues from its B2B and B2C segments, amounted to €115.2 million in Q1 2023, an increase of 6.2% YoY at constant currency.

Deezer’s total number of subscribers reached 9.3 million as of March 31, 2023, compared to 9.5 million in March, 2022, representing a decrease of 2.1% YoY.

Breaking its quarterly revenues down by segment, Deezer reports that its B2C revenues amounted to €81.7 million in Q1 2023.

That B2C revenue tally accounted for 71% of the company’s consolidated revenues, and was up 7.3% YoY at constant currency.

Deezer says that this revenue increase was primarily driven by a continued expansion of the group’s subscriber base in France, which was up 9.8% YoY.

The platform says this subscriber growth in its home market “allowed for clearly offsetting a decline in the Rest of World” which it reports was down 8.1% YoY “as a result of Deezer’s strategy to focus on selected key markets“.

Deezer’s ARPU (average revenue per user) for its B2C segment grew 6.6% YoY to €4.8 in Q1 2023 (see below).

The company says that this ARPU growth was “driven by a double-digit growth in the Rest of World on the back of the price increases and the positive impact of the group’s refocus on key geographies, and despite the expected gradual end of the price increase effect implemented in France in January 2022”.

Meanwhile, Deezer’s B2B revenues amounted to €30.8 million in Q1 2023, accounting for 27% of the music-streaming company’s consolidated revenues.

That €30.8 million revenue tally was up 8.5% YoY at constant currency. Deezer reports that this growth arrived “mainly as a result of the good performance of existing and new deals with large Telecom operators in France and Brazil and the progressive ramp up of the RTL partnership launched in Q3 2022”.

Elsewhere, other revenue, made up of advertising and “ancillary” revenue, amounted to €2.6 million in Q1 2023, down 32.2% compared to Q1 2022 which included a one-off revenue from a hardware company partnership.

The company said that this decline “also reflected lower advertising revenue as Deezer decided to shut down its loss-making freemium service in long-tail countries”.

Breaking down its revenue by geography, Deezer reveals that in France, its B2B and B2C revenue combined totaled €70.2 million at the end of Q1 of 2023, which it reports was up 8.6% compared to Q1 2022.

In the Rest of World, Deezer generated revenues of €45 million in Q1 2023 up 2.6% YoY at constant currency.

Deezer also breaks its subscriber base down by segment, reporting that in its B2C segment, the company’s number of subscribers totaled 5.6 million as at March 31, 2023, up 2.3% compared to March 31, 2022.

In its home market of France, Deezer says that its B2C subscriber base “continued to grow at a dynamic pace”, reaching 3.5 million subscribers as at March 31, 2023, marking growth of 9.8% YoY.

In the Rest of World, Deezer’s B2C subscriber base declined 8.1% to 2.1 million as of the end of March 2023.

The company’s total number of B2B subscribers stood at 3.6 million as of the end of March 31, 2023, a decrease of 8.2% compared to March 31, 2022. Deezer says that this decline was driven “by a legacy hard-bundled offer in Brazil not included anymore for new customers”.

“Our revenue performance in the first quarter of 2023 was in line with our expectations on the back of a strong first quarter of 2022.”

Jeronimo Folgueira, Deezer

Commenting on the company’s latest results, Jeronimo Folgueira, Chief Executive Officer of Deezer, said: “Our revenue performance in the first quarter of 2023 was in line with our expectations on the back of a strong first quarter of 2022.

“I am pleased with the continued expansion of our B2C subscriber base in France, the dynamism of our B2B business, where further growth acceleration is expected, as well as maintained ARPU improvements.

“We are satisfied with the progress of our business in the first quarter which gives us confidence that we will be able to continue to grow and significantly improve our adjusted EBITDA in 2023.”Music Business Worldwide

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