Pandora reported its latest quarterly financial results last night, but what’s been making headlines overnight is a report claiming the company turned down a $3.4bn acquisition offer from Sirius XM majority shareholder Liberty Media.

The Wall Street Journal claimed that Liberty made the offer in recent months as “a fishing expedition” valuing Pandora at $15 a share, but that it was rebuffed by Pandora, which had “shopped itself to other potential buyers, including Apple and Amazon, earlier this year”. Liberty has a 64% stake in satellite-radio firm Sirius XM, and has clearly been mulling the potential of combining the two.

The timing of the report meant it wasn’t addressed during Pandora’s earnings call for its quarterly financials, but there was plenty of information to chew on there on the company’s performance. Pandora’s revenues grew 20% year-on-year to $343m, or 12% to $320.3m if you exclude the acquired ticketing business from the calculations.

However, Pandora posted a net loss of $76.3m, compared to a loss of $16.1m this time last year. Active listeners fell slightly year-on-year from 79.4 million to 78.1 million, but listening hours grew by 7% to 5.66bn. The combination of the financials – lower guidance for its annual revenues included – and the rejected-acquisition news saw Pandora’s shares fall by 6.3% in after-hours trading.

There were other notes of interest in Pandora’s earnings call with analysts, including the company’s determination to launch its new on-demand tier by the end of the year. “We absolutely are committed to and believe we’re optimistic we’ll achieve a timeline where we can launch products by the end of this year,” said CFO Mike Herring.

Those launches are likely to be in the US, Australia and New Zealand rather than new markets globally, though.

“We are focused on rolling out the new on-demand product in our existing markets first, but absolutely see global as part of our path to 2020 and we’ll be working with the industry on those licensing deals going forward,” said COO Sara Clemens.

Pandora’s on-demand plans depend, of course, on striking the necessary deals with rightsholders. Pandora’s executives – as they must – are striking an optimistic tone on the progress of those talks.

“We continued to have very productive negotiations with the three major labels, as well as with our partners in the independent label community,” said Westergren, in his prepared remarks to analysts.

“Although these discussions are confidential, we believe they will result in our being able to deliver the product we want with the right business model, and that the investments we are making today will lead to win‐win results as they are delivered, both for Pandora and the music industry as a whole.”

Pandora has already talked publicly about its desire to launch multiple tiers of subscription, including sub-$10 options, in a music-subscriptions market dominated by the latter price point. Westergren maintained that labels are open to the idea.

“It’s one of the really encouraging parts of this so far. I think that what we’re finding is that the case we’re putting in front of the rights holders, people are believing that we are bringing something that is truly incremental and that is not just going to drive the high-end subscription but will also bring in a big part of the market that is not currently paying,” he said.

Some other points of interest from the call:

– Pandora’s Thumbprint Radio – its equivalent of Spotify’s Discover Weekly, which mixes listeners’ liked tracks with others the algorithm thinks they may like – appears to have been a hit. Clemens told analysts it is now the top station on Pandora with more than 14 million listeners, over-indexing among under-25s.

– Clemens also talked about a new case study in Pandora’s integration of streaming and ticketing: Australian dance artist Flume. “To promote his new album and accompanying world tour, Flume created a custom mix tape and launched a tour pre-sale supported by audio message, email and push notification,” she said. “Pandora sold over 25,000 tickets in three days, and 20% of house tickets for the entire tour.”

– Pandora’s advertising revenues were up 15% year-on-year, but Westergren admitted that they came in slightly below expectations in Q2, blaming “softness in national advertising in the entertainment and telco sectors”. He talked up Pandora’s growth in local ads; its plans for “new visual ad products” by the end of this year; and more growth from native advertising like sponsored listening.

– Herring addressed Apple’s recent proposal for publishing royalties in the US, where there would be a flat fee of 9.1 cents per 100 interactive streams. “Their proposal is basically they’ll have a flat fee per stream for publishing royalties across all music plays, whether it’s ad supported or subscription supported,” he said. “Which might work well for their purposes, but does create a bump in a market where there’s multiple businesses models and multiple approaches to delivering music to consumers.”

But Pandora, like Apple, is working hard to sign direct deals with publishers rather than rely on statutory rates. Its recently-announced partnership with Music Reports Inc (MRI) to administer direct deals has already signed up more than 1,800 publishers, reported Herring.

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