Pandora Media (P) late Thursday announced preliminary fourth-quarter revenue above its prior guidance amid solid subscriber growth, as the internet music operator faces stiff competition from Spotify, Apple (AAPL) Music and others.
Pandora "expects to exceed previously announced Q4 2016 revenue and adjusted EBITDA guidance," citing strong advertising and more than 4.3 million in paid subscription customers. Its new $4.99-a-month Pandora Plus offering topped 375,000 subscribers by the end of the year.
Pandora previously forecast revenue of $362 million to $374 million, with an adjusted EBITDA loss of $39 million to $51 million. Wall Street had pegged Q4 revenue at $369.09 million.
Pandora's subscriber base is dwarfed by Apple Music, with more than 20 million customers, and Spotify, which has more than 40 million. Spotify could come public in 2017. Amazon (AMZN) in October launched Amazon Music Limited, with discounts for Amazon Prime members. Alphabet (GOOGL) also is a music streaming play via its Google Play Music and its ad-supported YouTube.
Pandora is planning to cut 7% of its staff by the end of Q1 as part of efforts to improve "operational efficiency."
Pandora shares rose nearly 8% to 12.95 in late trading. Pandora closed the regular session up 0.1% at 12 on the stock market today, just below its 50-day and 200-day moving averages.
Shares got a brief boost in early December on SiriusXM (SIRI) buyout talk, hitting 14.10 on Dec. 7. But as the takeover buzz faded, so did the stock.
RELATED:
Apple Music Hits 20 Million Subscribers As Pandora Debuts Rival Service
