Pandora Earnings Preview: No Respite From Losses Expected

-2.14%
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Pandora Media

Pandora is scheduled to release its Q2 fiscal 2016 earnings on July 21st and although we expect notable growth in revenues, it should be accompanied by a substantial increase in operating losses. Pandora’s monetization has been improving consistently, driving revenues upwards and we expect this trend to have continued in the recently concluded quarter. However, we expect operating losses to have soared for the second quarter, on account of the recent increases in royalty rates (0.02 cents per performance) and surging sales and marketing costs. The company itself expects its adjusted EBITDA to fall by $41 million year over year.

Also, we will keep an eye out for updates on the performance of Pandora’s newly launched music channels that feature “hand-picked” music. With the company’s user base nearing saturation, strategies to improve the content on offer make sense because they can provide users an incentive to become paying subscribers.

Pandora second quarter earnings preview

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Have more questions about Pandora? See the links below:

Notes:

1) The purpose of these analyses is to help readers focus on a few important things. We hope such lean communication sparks thinking, and encourages readers to comment and ask questions on the comment section, or email content@trefis.com
2) Figures mentioned are approximate values to help our readers remember the key concepts more intuitively. For precise figures, please refer to our complete analysis for Pandora
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