France’s Deezer pledges to turn a profit by 2025

French music streams are seen before the opening bell for the company’s initial public offering (IPO) at Euronext in La Defense business and financial district in Courbevois, near Paris, France, on July 5, 2022 The logo of the media platform Deezer.REUTERS/Benois Tessier

PARIS, Sept 21 (Reuters) – French music streaming platform Deezer (DEEZR.PA) posted a 9.1 percent rise in adjusted gross profit in the first half of the year, helped by soaring sales in its home country, which bolstered its target The company said Wednesday that it will be profitable by 2025.

The group, once regarded in France as one of the first and most promising so-called “unicorns” with a valuation of 1 billion euros or more, is trying to convince investors that it has a market share by 2025 by focusing on key markets The ability to turn losses into profits. such as France, Brazil and the Netherlands, as well as new services.

Gross profit rose to 45 million euros ($44.4 million) from 42 million euros a year ago, while total sales rose 12 percent to 219 million euros in the same period, Deezer said in a statement.

This was mainly due to a 12.4% increase in average revenue per user (ARPU) to EUR 3.9. Deezer’s direct subscribers in France rose to 3.3 million from 3 million a year ago, accounting for about 60 percent of its combined revenue.

However, the total number of users fell by nearly 3% to 9.4 million.

“By focusing our business on large, attractive markets and entering new markets with a partner-led model, we believe we can capture a fair share of the booming streaming market and continue to improve our profitability , to break even by 2025,” said CEO Jeronimo Forghera.

Compared to bigger rivals Spotify (SPOT.N) and Apple Music (AAPL.O), Deezer, which has yet to recover from a painful debut on Euronext Paris in July, traded at 7 plunged 35% for the month. The first few hours after listing.read more

The stock has fallen 65 percent since its first trading day, valuing the company at 472 million euros ($466.38 million), compared with Spotify’s $18.7 billion market cap.

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Reporting by Mathieu Rosemain; Editing by Elaine Hardcastle and Emelia Sithole-Matarise

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