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Pandora Losses Grow, Though Ad Revenue Was Up in 2015

Ad revenue up 27%

Pandora is now a billion-dollar-a-year company; but it also lost a lot more money than it did last year, this at a time when its listener growth has flattened and its competition in the streaming space has increased.

The company said total revenue grew 26% to $1.16 billion, helped in large part by growth in advertising as well as a recent acquisition. And total listener hours increased by 5% in 2015.

But the company reported another net loss, this time of $169.7 million, compared to a loss the year before of $30.4 million. (Fortune magazine wrote last fall that Pandora “has lost money since inception.”) And its number of active listeners fell slightly after growing the year prior.

Separately, the New York Times reported Wednesday that Pandora has explored the possibility of selling itself.

About $933.3 million of its $1.16 billion in revenue came from advertising, a number that traditional radio stations competing with Pandora are likely to focus on; this was up from $732 million the year before. But Pandora also reported revenue from subscriptions and other sources of $220.5 million, plus about $10 million from Ticketfly in the first two months Pandora owned it. Pandora also recently acquired assets of Rdio.

CEO Brian McAndrews said Pandora has made “substantial investments and progress” toward its goal of “unifying the full music experience under one roof, spanning radio, on-demand and live music.”

The company uses a metric called RPM, for revenue per 1,000 listener hours, and said total RPMs for the year grew 19%. It said total listener hours grew 5% to 21.11 billion for the year, though the number of “active listeners” fell slightly to 81.1 million at the end of 2015, compared to 81.5 million a year earlier.

Pandora also incurred one-time charges of $57.9 million for its pre-1972 sound recordings settlement and $23.9 million as a result of a decision to forgo application of the Radio Music Licensing Committee publisher royalty rate from June 2013 to September 2015.

Unlike last year, Pandora’s fourth quarter wasn’t kind. Where a year ago the company turned net income of $12.3 million in Q4, this year it posted a loss of $19.4 million.

In 2016 the company expects total revenue in the range of $1.4 billion to $1.42 billion.

Pandora Execs Say They Don’t Want to Sell, Lay Out 5-Year Plan (Variety)