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Pandora thinks it can outlive Apple Music

Next quarter might be a different story.


Taylor Hatmaker


Posted on Jul 24, 2015   Updated on May 28, 2021, 7:15 am CDT

Pandora isn’t afraid of Apple Music—not yet anyway. 

In its quarterly earnings report, the streaming radio stalwart surprised Wall Street with better-than-anticipated revenue, largely thanks to a bump in its ad efforts. Pandora brought in $285.6 million during the quarter ending on June 30, besting a predicted $283 million. Of that revenue, $230.9 million was from advertising. The company saw a 5 percent year-over-year increase in listening hours, which totaled 5.3 billion in the June quarter.

Apple Music’s June 30 launch means that Pandora won’t know how many of its users are defecting to its competitor’s much-hyped Beats 1 radio station until the following quarterly report. 

Pandora’s $285.6 million marks a record high for the company and a 30 percent year-over-year increase for both total revenue and ad sales. Still, like every other streaming music service out there, Pandora continues to fight an uphill battle for profitability. As the Wall Street Journal observed earlier this year, in order to do so, Pandora’s ad sales need to grow at a rate far greater than any increase in user listening on its platform. 

Like Spotify, Rdio, Apple Music, and other streaming music services, Pandora is looking for the sweet spot at which royalty payouts to record labels balance with the revenue it brings in from advertising and paid subscribers on its premium tier. With ad revenue picking up, Pandora committed to digging its heels in for the long haul. 

“In terms of the Apple Music, in Q2, of course, Apple Music launched at the end of June, so there was no impact in terms of going forward, you know we feel really good about our trajectory competitive and position,” Pandora CEO Brian McAndrews explained during the call.

“I think it’s really obviously very early days and with any big launch like this and the noise and things happening in the marketplace, there could be some listeners who experiment with the service and there could be some short-term impact, but… we aren’t seeing any meaningful listener impact at this time and we don’t expect any long-term meaningful impact either.”  

Photo via marfis75/Flickr (CC BY-SA 2.0)

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*First Published: Jul 24, 2015, 5:31 pm CDT