Pandora revealed its third quarter financial figures yesterday, and can now say growth in mobile revenues have caught (and is outpacing) growth of its mobile audience.
[We reported this week that comScore figures show Pandora, with 77% of its total listening hours now from mobile, is the Internet's most "mobile-centric" company here.]
And while earnings (as well as audience growth -- Pandora reports 3Q13 total listener hours of 3.56 billion, up 67% year-over-year; with 59.2 million "active users," up 47% year-over-year) appear quite healthy, Pandora's stock dropped once again in after-hours trading, as the service battles with the music industry to secure a more favorable royalty structure.
For the three months ending October 31, 2012 (Pandora's fiscal 2013 third-quarter), Pandora made $120 million ($106.3 million from advertising; $13.7 million from subscriptions -- both up from last year). While that's up 60% from the same period last year, the company's "content acquisition costs" (aka royalties) rose 75%.
As mentioned, the gem in its revenue news is mobile. Pandora reports 3Q13 total mobile revenue of $73.9 million, 112% growth year-over-year. It was at the end of this time period that the service launched Pandora 4.0, its most significant mobile app redesign ever (here). The aim, of course, is that by enhancing the usability of the app, and increasing the value of interacting with it, it also increases the value of accompanying advertising.
Pandora now says it employs sales managers in 27 of the country's top 40 radio markets, and has local account execs on the street in 17. Pandora CEO Joe Kennedy told investors yesterday to expect "significant additional hiring" approaching a total of 100 local sellers, Tom Taylor reports.
"Be prepared to hear about 'RPM' – Pandora’s internal metric of advertising revenue earned per thousand listening hours," writes Taylor.