STOCKHOLM - Shares in Storytel plunged by 20% on Friday after the Swedish audiobook streaming group cut its revenue and subscriber guidance, taking a hit from higher marketing spend and worse than expected performance in Spain and Latin America.
Storytel now expects to increase its subscriber base to between 1.95 million and 2 million by the end of the year, down from a previous forecast of between 2.1 million and 2.2 million subscribers. The company had a little more than 1.6 million subscribers at the end of the second quarter
It cut its streaming revenue forecast to between 2.25 billion and 2.3 billion Swedish crowns ($261 million to $267 million) from 2.4 million to 2.5 billion crowns and said it expects a negative EBITDA margin of 6-8%, against its previous forecast of 0% to -5%.
Storytel, which offers listening and reading of more than 500,000 titles across 25 markets, said strong growth in the Nordics was offset by slower than expected growth in Latin America and Spain.
The company has raised prices in countries such as the Netherlands and Belgium but lowered them in Spain, citing reduced purchasing power.
The EBITDA margin forecast dipped because of increased marketing investment to build awareness in markets such as Poland, the Netherlands and Finland.
"Our mid-term target for 2023, 30-35% annual revenue growth, remains our target as our underlying business is growing solidly at 20-25% and we believe there are ample opportunities for us to generate additional growth via new market launches, partnerships and M&A," CEO Jonas Tellander said in a statement.
Storytel shares were trading at 170.50 crowns at 0800 GMT, down 20.1%.
($1 = 8.6211 Swedish crowns)
