Spotify Results Presentation Deck slide image

Spotify Results Presentation Deck

Operating Expenses Primarily driven by efficiency related charges Operating Expenses grew 13% Y/Y (or 16% constant currency*), driven predominantly by charges related to efficiency efforts of €91 million (contributing ~1,000 bps to Y/Y Operating Expense growth), of which roughly €83 million were related to real-estate impairments and the remaining €8 million were severance-related and other charges. Additionally, Y/Y changes in Social Charge movements of €35 million impacted Y/Y expense growth by 400 bps. All remaining Operating Expense growth reflected higher personnel costs related to Y/Y headcount growth and acquisitions, partially offset by lower marketing and legal costs in the quarter. As a reminder, Social Charges are payroll taxes associated with employee salaries and benefits in select countries where we operate. Since a portion of these taxes is tied to the intrinsic value of share-based compensation awards, movements in our stock price can lead to fluctuations in the taxes we accrue. This resulted in Social Charges related to share-based compensation of €25 million in the current period vs. (€10) million in the prior year period. Spotify * Constant Currency adjusted measures are non-IFRS measures. See "Use of Non-IFRS Measures" and "Reconciliation of IFRS to Non-IFRS Results" for additional information. €4,000 €3,000 €2,000 €1,000 20% 15% 10% 5% €0 0% Operating Expense Trends INMI Q3'20 Q4'20 Q1'21 Q2'21 Q3'21 Q4'21 Q1'22 Q2'22 Q3'22 Q4'22 Q1'23 Q2'23 - Total Operating Expenses Y/Y Total Operating Expenses, LTM (EM) 13% Items Affecting Operating Expense Growth Y/Y In Q2¹23 Total Operating Expenses Y/Y 3% FX Movements TH -4% Social Charges -10% Efficiency Charges 2% All Other Expenses 80% 60% 40% 20% 13% 0% 11
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