Pandora Doubles Sales, Readies for IPO
Internet radio company Pandora Media said Thursday that sales more than doubled in the first-quarter as its user base soared above 90 million, juicing its top line ahead of a planned IPO.
Sales climbed to $51 million in the three months ended April 30 from $21.6 million a year ago, but the company widened its loss on marketing expenses and costs of new song licenses.
The Oakland, Calif.-based company, which sells advertising and subscriptions, booked a net loss of $9.1 million, or 61 cents a share, compared with $4.97 million, or 64 cents a share, in the same quarter last year.
While subscriptions jumped 10 million from 80 million in January, Pandora said it doesn’t expect to return to profitability until next fiscal year.
Pandora, which has solidified itself as the top streaming radio company, said underwriters for its IPO have extended a $30 million credit facility. The new facility replaces an earlier facility and equipment financing line the company received in 2009.
J.P. Morgan (NYSE:JPM), Morgan Stanley (NYSE:MS) and Citigroup (NYSE:C) are leading the IPO. Pandora plans to list its shares on the New York Stock Exchange under the symbol P.
Pandora’s planned $100 million IPO comes at a time when interest over Internet startups continues to mount on Wall Street. LinkedIn (NYSE:LNKD) and Yandex NV (NASDAQ:YNDX) went public this month, while Facebook, Groupon and Twitter’s highly anticipated IPOs continue to loom.
Music over the web has become popular and fiercely competitive over the last few years.
Tech giants Facebook, Google (NASDAQ:GOOG) and Amazon (NASDAQ:AMZN) are launching and promoting new cloud-based music services that allow customers to store purchased music on a database so they can listen to their libraries on mobile devices and other computers through a remote server.
Pandora has been one of the most popular apps on Apple’s iPhone and Google’s Android devices.
There are also Internet streaming companies such as Grooveshark, Rdio and MOG, which offer unlimited streaming over the web. With both Pandora and its Internet streaming rivals, though, customers do not own the songs.