Pandora 2016 Annual Report Download - page 57

Download and view the complete annual report

Please find page 57 of the 2016 Pandora annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 124

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124

As of December 31,
2014 2015
(in millions)
Active users 81.5 81.1
We define advertising-based active users (“ad-based active users”) as the number of users, excluding subscribers, that
have requested audio from our servers within the trailing 30€days to the end of the final calendar month of the period. We
define subscribers as the number of distinct users at the end of the period that have subscribed to our service. Inactive
subscribers are included as they contribute towards revenue per thousand listener hours (“RPMs”), which are described in
further detail below.
The table below sets forth our users on an advertising and subscription basis as of December€31, 2014 and 2015.
As of December 31,
2014 2015
User Type Users (in millions)
Ad-based active users 78.5 77.6
Subscribers* 3.6 3.9
Total 82.1 81.5
* Includes subscribers that have not used our service within the trailing
30 days to the end of the final calendar month of the period.
The table below sets forth our listener hours on an advertising and subscription basis for the eleven months ended
December 31, 2013 and the twelve months ended December€31, 2014 and 2015.
€
Eleven Months Ended€
€December 31,
Twelve Months Ended€
€December 31,
2013 2014 2015
User Type Listener hours (in billions)
Ad-based active users 13.34 17.58 18.47
Subscribers 1.97 2.45 2.64
Total 15.31 20.03 21.11
Advertising Revenue per Thousand Listener Hours (“ad RPMs”)
We track ad RPMs for our non-subscription, ad-supported service because it is a key indicator of our ability to monetize
advertising inventory created by our listener hours. We focus on ad RPMs€across all of our delivery platforms. We believe ad
RPMs€to be the central top-line indicator for evaluating the results of our monetization efforts. Ad RPMs are calculated€by
dividing advertising revenue by the number of thousands of listener hours of our advertising-based service.
Subscription and Other Revenue per Thousand Listener Hours (“subscription RPMs”)
We track subscription RPMs because it is a key indicator of the performance of our subscription service. We focus on
subscription RPMs€across all of our delivery platforms. Subscription RPMs€are calculated by dividing subscription and other
revenue by the number of thousands of listener hours of our subscription service.
Total Revenue per Thousand Listener Hours (“total RPMs”)
We track total RPMs for our service, which includes ad and subscription RPMs, because it is a key indicator of our ability
to monetize our listener hours. Total RPMs€compare advertising and subscription and other revenue in a given period to total
listener hours in the period. We calculate total RPMs€by dividing the total revenue by the number of thousands of listener hours.
Licensing Costs per Thousand Listener Hours (“LPMs”)
Table of Contents
46