SoundCloud, with more than 200m tracks on its platform, saw 12-monthly revenue run-rate top $200m last year

If there’s one stat that says everything about the recovery of SoundCloud in recent years, it’s this: in calendar 2017, the company turned over circa $102m. But just two years later, in Q4 2019, the firm’s 12-monthly gross revenue run-rate exceeded $200m for the first time in history.

SoundCloud informed MBW about this 2019 financial milestone today (January 17) as we learn, via a detailed filing at UK Companies House, how the firm performed in the prior calendar year (2018).

In 2018, SoundCloud Ltd. – whose annual figures are reported in Euros – turned over €108m, which equates to $127m when converted to US dollars in line with US GAAP. (The firm’s 2018 report is based on UK GAAP financial requirements.)

This meant that SoundCloud beat its financial growth targets. Its total 2018 revenues were up 19% year-on-year, but 23% when discounting YoY currency fluctuations.

A company spokesperson told MBW:  “SoundCloud’s 2018 annual report filed to Companies House shows substantial revenue growth and continued loss reductions vs. 2017.

“2019 results will be filed later this year, but we are pleased to report SoundCloud surpassed its full-year growth plans for the second year in a row [in 2018], increasing revenue to $127m (€108m).

“We look forward to continuing to grow SoundCloud’s unique creator-driven ecosystem and business in the year ahead.”


Perhaps most pleasingly for SoundCloud CEO Kerry Trainor (pictured inset) – plus investors Temasek and Raine Group – the company’s annual operating losses narrowed significantly, from €51.4m in 2017 to €32.9m ($38.7m) in 2018.

This year-on-year op loss reduction was close to 50% (2017: €49.5m vs. 2018: €25.1m) when you strip out non-cash stock-based compensation for execs.

Post-tax loss at SoundCloud hit €32.0m ($37.6m) in 2018, down from €63.8m in the prior year.

According to its freshly-published annual report, SoundCloud has, to date, “amassed the world’s largest and most diverse audio catalogue with over 200m tracks”.

SoundClound’s previous annual report suggested that the platform’s catalog grew by around 20m tracks in 2018 – or circa 55,000 every single day: its catalog size topped 190m unique tracks in January 2019, versus 170m at the close of 2017.


SoundCloud says its key drivers of 2018 growth included:

  • Expansion of its SoundCloud Premier monetization, which distributes the work of “tens of thousands of creators”. (Unlike Spotify, SoundCloud still offers its Premier customers a service to distribute their music to both SC and its rival platforms);
  • Improvements to SoundCloud’s interactive listener experience, including the ability to comment directly on tracks in the mobile application, higher-quality streaming and hand-picked, curated playlists;
  • Partnering with Pandora as SoundCloud’s exclusive U.S. advertising and sales partner, creating “the largest digital audio advertising offering in the U.S. reaching a combined audience of more than 100 million”.

Other interesting findings in SoundCloud Ltd’s latest report include the fact that the firm reduced its ‘Administrative Expenses’ by 22.9% in 2018, down to €58.2m ($68.4m) from €75.5m in 2017.

One clear area influencing this cost-saving came within the firm’s staff count, and the money it spent on wages.

In 2018, SoundCloud’s group employed 240 people on average, down from 307 in the prior year. Total expenditure on wages and salaries amounted to €25.8m ($30.3m), down from €34.5m in 2017.

Compare these figures to Spotify, which in 2018 employed 3,651 full-time staff on average – over 15 times (!) more than SoundCloud –with a total wage bill of €409m, nearly 16 times that of its rival’s.

In its Companies House filing, SoundCloud says investors should expect total headcount to grow by around 5% following its acquisition of Repost Network last year.



Two other interesting areas of SoundCloud’s financials: its global story, and its split between advertising and paid-for subscription income.

SoundCloud broadly has three income types: (i) Creator/uploader subscriptions (SoundCloud Pro and Pro Unlimited); (ii) Listener subscriptions (SoundCloud Go and Go+); and (iii) Advertising put in front of non-subscribers.

In 2018, SoundCloud generated €83.2m ($97.8m) from subscription, up 14.5% year-on-year (see below). Advertising revenues (€24.8m) grew faster, up 37.4% YoY.

Subscription payments made up 77.0% of SoundCloud’s total 2018 revenues, with advertising generating 23.0%, on €24.8m.

A Spotify comparison is illustrative here: in 2018, some 89.7% of Spotify’s revenues came from subscriptions (€4.72bn), with just 10.3% (€542m) from advertising.



Looking at SoundCloud geographically, 69.6% of its total revenues in 2018 came out of the United States (€75.1m), compared with 71.1% in the prior year – suggesting the firm’s revenue mix is becoming slightly more international.

The USA was responsible for 63.9% of global subscription revenues in 2018, and 88.8% of advertising revenues.Music Business Worldwide

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