(Bloomberg) -- Spotify Technology SA fell as much as 8.6% after its premium revenue fell short of analysts' expectations even as subscriptions rose, with consumers in some markets resisting the company's price increases.
The world's largest streaming audio service said Thursday that premium revenue, generated by its paid subscriptions, was 1.79 billion euros ($2.1 billion) in the third quarter. Analysts expected 1.83 billion euros, according to a consensus compiled by Bloomberg.
Spotify shares were down 7.5% to $255.38 at 9:41 a.m. in New York. They had climbed 85% this year through Wednesday's close, driven in part by the Swedish company's push into podcasts.
The streaming giant said average premium revenue per user fell 10%, or 6% at constant currencies. Spotify cited price increases for its family plans in Australia, Belgium, Switzerland, Bolivia, Peru, Ecuador and Colombia.
However, Spotify added 21 million monthly active users in the third quarter, bringing its total to 320 million. That topped analysts' estimate of about 316 million.
The pandemic took a toll on music consumption earlier this year when consumers around the world stopped traveling or commuting. But listening began to rebound in May, spurring optimism that the industry can bounce back.
Spotify said listening has recovered “to normal usage.” including in-car listening hours that are now above pre-pandemic levels.
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Spotify said new music releases on the platform during the third quarter were up 13% compared with the prior quarter, led by Taylor Swift's “folklore” album, which set a record for the most first-day album streams by a female artist.
Podcast listenership also suffered during the pandemic, but Spotify sees it as a major source of growth in the long term. It's been signing exclusive deals for podcasts from Joe Rogan, Michelle Obama and Kim Kardashian, and investors have been betting that the streaming giant can be a major player in the still-nascent industry. The company said 22% of its monthly active users listened to a podcast during the third quarter, up from 21% in the second.
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