SoundCloud increased revenue by 80 percent and suffered smaller losses over the course of 2017, according to an annual report filed to the UK’s Companies House this week. The company reported earnings of €90.7 million ($102 million) for the year, up significantly from €50.3 million in 2016, an improvement it attributed to growth in its creator and listener businesses. Operating losses were €51.4 million, down from €70.5 million the year prior.
Subscription revenue nearly doubled in 2017, to €72.6m ($82 million) from €38.4 million in 2016. Advertising revenue was €18 million, up from €12 million the year prior.
“[The annual report] reflects a pivotal year in which the company fully recapitalized for sustainable growth, while achieving substantial revenue growth and loss reductions vs. 2016,” the company said. “While 2018 results will not be filed until later this year, we are pleased to report SoundCloud also surpassed its full year 2018 growth plan, building on the 2017 improvements posted today.”
It was during 2017 that SoundCloud reduced its headcount by roughly 40 percent, ending the year with 214 employees across offices in Berlin, New York City and London. The reductions resulted in lower operating expenses, impacting the second half of the year. August of 2017 also saw a $170 million investment round, led by The Raine Group and Temasek, and ushered in a new CEO for the company, former AOL and Vimeo exec Kerry Trainor.
Looking ahead to its 2018 results, the company predicted growth across its three revenue lines, which break down as creator products/services, consumer-facing subscriptions and advertising. SoundCloud’s advertising business was fortified via partnerships with Pandora in the U.S. and with Global Radio / DAX in the U.K.
“This points to further material improvement of SoundCloud ?s overall strategic and financial position in 2018, and we expect 2019 to be another strong year of products and services for our community of creators and listeners, and a solid operating performance,” the company said.
SoundCloud did caution that 2019 results could be affected by the “uncertainties” of the U.K.’s pending exit from the European Union, set for March. “The company is, however, actively monitoring the situation and evaluating potential measures on a regular basis and will respond in a suitable manner as soon as a reliable legal and operational framework has been agreed.”