Spotify Revenues Reach £1.5bn But Loss Widens

Spotify, the world's biggest music streaming service, saw revenues surge 80% to €1.94bn (£1.5bn) last year but losses deepened as it ploughed money into investments.

The company said it had 89 million users by the end of 2015 – up from 60 million a year earlier – of whom 28 million were paying for subscriptions.

But the Swedish company, founded in 2008 and offering unlimited music on demand, has yet to turn a profit and latest results showed losses widening by 7% to €173m (£134m), AFP reported.

It (Other OTC: ITGL - news) is ploughing money into investments amid competition from Apple (NasdaqGS: AAPL - news) as well as the likes of Deezer (Euronext: DZR.NX - news) , Rhapsody and Tidal – the latter spearheaded by rap mogul Jay Z.

Results were published by Luxembourg-based holding company Spotify Technologies. The business's 80% growth in revenues outpaced the 45% increase in 2014 as well as the 74% rise in 2013.

In a message to shareholders, the company said: "In many ways, it was our best year ever."

The company predicted that as it continued to expand, profit margins would benefit.

"We believe that we will generate substantial revenues as our reach expands and that, at scale, our margins will improve," it said.

"We will therefore continue to invest relentlessly in our product and marketing initiatives to accelerate reach."