The revenue of Spotify is expected to improve at a slower rate in 2018, as the music streaming site gears up for its public listing that is scheduled next week.
Yesterday, the technology company said that it expects that revenue to increase between 20 and 30 percent to as much as €5.3bn (£4.6bn) this year, a rate slower compared to the 39 percent rise that was recorded for 2017.
The comparative growth last year was boosted by the improved licensing deals with huge record companies. This year, Spotify will also experience the negative effects of foreign exchange rates, enduring a hit of a maximum of €300m.
Spotify is scheduled to list on the New York Stock Exchange next Tuesday. The current value of the company is estimated to be over $20bn (£14bn).
Spotify is based in Sweden. The company will aim to increase $1bn in its float. The cost of the direct listing will be a maximum of €40m, which will be expensed during the second quarter and contribute to the annual loss of the company of between €230m and €330m.
The debut of the company on the stock market will differ from the typical format, as the firm will not issue any new shares. The process is known as a direct listing. It means that the company and its employees or investors can sell any shares that they own to the public.
The shares will not be backed by underwriters, meaning that the price could possibly be volatile during the initial stages.
The said update also predicted that the monthly active users of Spotify would increase to more than 200 million in 2018, while even more people are anticipated to sign up to be premium subscribers with a rise of at least 30 percent.