With what looked like a dark cloud looming over SoundCloud, the streaming platform may have found a ray of sunshine as they attempt to become profitable.
According to Digital Music News and data collected by PrivCo, SoundCloud amassed a gross revenue of $28 million in 2016 - a 43% increase from year’s past. Back in 2014, the company reported a $43.9 million loss while also reporting $19.48 million in revenue. Now, as more money could be coming in, SoundCloud might actually be lucrative in the near future.
The new revenue numbers come at an interesting time for SoundCloud as recent reports state they are in advanced talks to be acquired by Spotify. That being said, in February of this year, SoundCloud’s financial auditor KPMG issued a statement that warned investors of potential financial troubles ahead.
“The directors have concluded that the combination of the circumstances… represents a material uncertainty which may cast significant doubt upon the Company’s and Group’s ability to continue as a going concern,” stated the auditor. “Therefore the Company and Group may be unable to realize its assets and discharge its liabilities in the normal course of business.”
SoundCloud may have turned things around after the statement was issued as they signed deals with Universal Music Group and Sony Music Entertainment, a necessary step forward in the streaming industry. Ads have also been implemented and a subscription service, called Go, could be sources for the increase in revenue.
We’ll have more information on the possible acquisition of SoundCloud by Spotify if and when it happens. That deal is estimated to be valued at $1 billion.
Harrison is Mixmag's East Coast Editor. Follow him on Twitter here