US radio group iHeartMedia has published its latest quarterly financial results, revealing that its revenues grew by 2.4% year-on-year to $913.3m in the second quarter of 2019, including a 32.8% increase in digital revenue.
The company reported a net profit of $11.3bn, which sounds startling until you read the “driven by a net gain of $9.5 billion recognised in relation to our emergence from bankruptcy” line in the financials.
The company said its iHeartRadio app ended Q2 with 130 million registered users (iHeartMedia doesn’t give out active-user numbers still), and called out podcasts in particular as a source of growth: podcast listeners in iHeartRadio’s app grew by 300% year-on-year. However, CEO Bob Pittman came out swinging in the company’s earnings call later, claiming that 75% of iHeartMedia’s listening comes from 34% of its audience – this is radio – and comparing that to streaming rivals. “In contrast, 73% of Spotify’s listening comes from just 3% of their audience and 72% of Pandora’s listening comes from just 5% of their audience. That’s the music collection experience,” said Pittman. Asked about this claim on Twitter, Spotify CEO Daniel Ek expressed puzzlement. “Not sure where that data is from, but it’s far from true.”
It looks like Pittman is going to continue poking Spotify though. From this earnings call alone: “We have a strong social presence. Our 194 million fans and followers are more than seven times Spotify’s” and “it’s telling that even with the acquisition Spotify has made, they’re still not in the top 10 podcast publishers”.
Such barbs are fun for journalists and analysts, but the challenge posed to iHeartMedia by Spotify, Apple Music and the streaming sector in general remains very real. Don’t be too surprised if Ek (or perhaps more likely CFO Barry McCarthy) spends some time filleting radio’s drawbacks in their next earnings call just to remind iHeartMedia’s boss of that…