Monday, May 11, 2020

Napster needs outside funding within the next 12 months | Music Ally

Tech firm RealNetworks has published its quarterly financial results, including as usual figures for music-streaming firm Napster, in which it holds an 84% stake.

Napster’s subscription revenues grew from $24.3m in the first quarter of 2019 to $26.3m in the first quarter of 2020: an 8.2% rise, albeit one that reflects the small scale of the business compared to its biggest rivals.

The financials split Napster’s revenues out by D2C (consumer subscriptions) and B2B (income from white-label streaming services it runs for partners). B2B revenues grew by 6.3% to $12.9m last quarter, while D2C revenues grew by 10% to $13.5m. Meanwhile, Napster managed to cut its operating losses from $1.6m in the first quarter of 2019 to $210k in Q1 2020.

For RealNetworks as a business the financials also, in the context of the Covid-19 pandemic, “raise substantial doubt about our ability to meet our obligations over the ensuing 12 months and, therefore, to continue as a going concern” and mentions that “we are evaluating various strategic opportunities, which may include selling certain businesses or product lines, soliciting external investment into certain of our businesses, or seeking other strategic partnerships”. It goes on to note that “Napster will also require outside funding in order to meet its anticipated cash needs over the next 12 months”.

Stuart Dredge


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