STOCKHOLM: Spotify Technology SA on Tuesday reported fourth-quarter results that beat expectations for both active users and subscribers, and forecast the number of listeners would reach 500 million next quarter.

The number of monthly active users rose to 489 million in the quarter, beating Spotify’s guidance and analysts’ forecasts of 477.9 million.

Premium subscribers, who account for most of the company’s revenue, rose 14% to 205 million, topping estimates of 202.3 million, according to IBES data from Refinitiv.

The growth was driven by marketing campaigns and as more listeners signed up in countries such as India and Indonesia.

Apart from the forecast of half a billion users, Spotify also expects premium subscribers to reach 207 million in the current quarter and revenue of 3.1 billion euros ($3.35 billion). Analysts were expecting subscribers of 202 million and revenue of 3.05 billion euros.

Its quarterly revenue was 3.2 billion euros, above analyst estimates of 3.16 billion euros.

Spotify to lay of about 600 staff as tech woes spread

Spotify last year laid out plans to get 1 billion users by 2030 and to reach $100 billion revenue annually. It also promised high-margin returns from its costly expansion into podcasts and audiobooks.

The company has invested more than $1 billion in building out its podcast business which currently has more than 4 million titles.

But those investments have hit gross margins.

Last week Spotify announced plans to layoff 600 employees as it sought to control its operating expenditure that grew at twice the speed of its revenue last year.

In 2023, the company expects revenue to begin to grow faster than operating expenses, which have jumped due to headcount growth and higher advertising costs.