This website uses cookies so that we can provide you with the best user experience possible. Cookie information is stored in your browser and performs functions such as recognising you when you return to our website and helping our team to understand which sections of the website you find most interesting and useful.
Business News Digital
SoundCloud posts rising losses
By Chris Cooke | Published on Monday 13 October 2014
SoundCloud’s revenues were up in 2013, but so were its losses, according to an annual filing by the digital firm. SoundCloud’s revenues were up from 8 million euros in 2012 to 11.2 million in 2013. But in the same period losses more or less doubled, from 12.4 million euros in 2012 to 23.1 million in 2013.
Explaining the rising costs, which are somewhat out of kilter with rising revenues, the firm’s financial report notes: “We are in a phase of growing SoundCloud into the market-leading platform for listening to, creating and sharing sound. This has necessitated investment in technology, headcount and marketing. Our overhead base has increased faster than our revenues”.
As previously reported, while adding advertising tools to its platform – which it is now in the process of doing – may have been in the pipeline for sometime at SoundCloud, it’s widely assumed that management have been under pressure from investors of late to get moving with revenue streams other than selling premium accounts to content owners. This could be the result of SoundCloud failing to find a buyer for itself, early doors investors likely banking on a big purchase or IPO to get a return on their investment.
At least some investors seem to reckon that for SoundCloud’s ad-funded business to really take off it needs the major labels on board, though, as the FT reported last week, talks in that domain seem to be slow going.
That said, as a distribution platform SoundCloud remains popular with rights owners and artists, and the firm does boast a significant user-base. It remains to be seen if the company can exploit those positives to do the deals it needs to seriously enter the online ad sales business.
