Today, 8:45 AM
- Pandora (NYSE:P) states the Register of Copyrights declined to express an opinion on the matter of differentiated music webcasting royalty rates. She added that since all participants in the ongoing Web IV rate proceeding had assumed a non-differentiated (uniform) rate structure, such a structure is the only reasonable outcome for the proceeding.
- Pandora has been seeking a uniform rate structure. The Register of Copyrights' opinion comes ahead of a mid-December decision by the Copyright Royalty Board (CRB) on the recording royalty rates Pandora will pay from 2016-2020. Pandora rose in September after the CRB backed the admissibility of Pandora's deal with indie music rights agency Merlin as a benchmark for broader recording royalty rates.
- Recording royalty payments account for much of Pandora's content acquisition costs, which in turn totaled $129.5M (42% of revenue) in Q3 after backing out one-time charges. Shares have risen to $13.97 premarket.
Wed, Nov. 11, 2:03 PM
- Pandora (P +3.8%) is now up 9% from Monday's close, possibly aided by a Bloomberg report stating the company is mulling expansion into the U.K. and other overseas markets. The gains also come amid two conference talks by CFO Mike Herring: Herring presented at a Wells Fargo conference yesterday, and at an RBC conference today (webcasts: I, II).
- With 27.5M shares (14% of the float) shorted as of Oct. 15, and many shorts holding decent paper profits, short-covering could be helping.
- Separately, at the M1 Summit mobile conference, VP Lisa Sullivan-Cross suggested Pandora is thinking of adding an offline mode. Cross: "It's something we're looking at ... We know our customers want it." Spotify and various other subscription services support offline downloads.
Thu, Nov. 5, 12:25 PM
- Pandora (NYSE:P) has inked a multi-year performance royalty licensing deal with Sony/ATV, the world's biggest music publisher. Terms are undisclosed.
- Sony: "We are pleased that our songwriters will begin to enjoy the benefit of better rates on one of the most important platforms for music consumption and discovery." Pandora notes performance royalties paid to rights holders for master recordings aren't affected by the deal. Recording royalties paid to SoundExchange have historically accounted for a much bigger portion of Pandora's content costs.
- In May, publishing rights group BMI won a ruling (it has since been appealed) granting it higher performance royalties from Pandora. In September, Pandora won a favorable ruling from the Copyright Royalty Board regarding the use of a deal with indie rights agency Merlin as a benchmark for broader recording royalty rates.
- Three days ago: Pandora strikes distribution deal for hit podcast Serial
Mon, Nov. 2, 1:56 PM
- Pandora (NYSE:P) will be the "exclusive streaming partner" for season two of podcast Serial. The launch date for season two, which will still be available for download via other venues, hasn't been disclosed.
- Each episode will be broken into 5-minute chunks for users looking to pick up where they left off or skip ahead. Pandora, which saw its active listeners drop Q/Q in Q3 (Apple Music was partly blamed), states over 8M people have downloaded each episode from season one of Serial.
- Serial editorial advisor Ira Glass: "Serial is the biggest podcast in the world, but only 17% of Americans listen to podcasts at all ... Pandora reaches millions of people who never listen to public radio or download podcasts."
- Separately, Pandora has closed its $450M cash/stock acquisition of online ticket agency Ticketfly. The company's beaten-down shares are rallying on a day the Nasdaq is up 1.1%.
Mon, Oct. 26, 10:07 AM
- Believing "the bear/bull case is now too asymmetrical to ignore," Macquarie's Amy Yong has upgraded Pandora (NYSE:P) to Outperform following a 33% Friday drop caused by the company's soft Q4 guidance and Q/Q listener decline (blamed in part on Apple Music). Her target is $19.
- Yong doubts Apple Music (recently disclosed to have 6.5M paid subs, and another 8.5M on free trials) will drive long-term share gains, and argues marketing spend increases from Apple Music rivals such as Spotify will be temporary.
- She also considers higher royalty costs priced in, thinks revenue can continue growing as improved monetization (higher RPMs) offset listener hour pressure, and thinks new products such as Pandora's One Day Pass increase Pandora's are growth opportunities.
- Pandora is down 27% YTD.
- Prior Pandora coverage
Fri, Oct. 23, 12:46 PM
Fri, Oct. 23, 10:59 AM
- "We are shocked by guidance implying monetization is hitting a wall (despite salesforce, pricing drivers)," says SunTrust's Robert Peck, nevertheless reiterating his Buy rating while cutting the price target to $18 from $25.
- He says his already cautious monetization thesis is impaired. What's the use in downgrading at this point, he laments, noting possible near-term catalysts (CRB, conservative guidance, direct deals).
- "We expected a modest impact from the Apple Music launch, but it turned out to be more fundamentally challenging than we thought," says FBR's Barton Crockett, maintaining his Underperform rating and taking the price target down by $1 to $10.
- "We continue to believe that with nearly 90M logged-in mobile users and over 5B hours of engagement, Pandora's (NYSE:P) value as a platform is under-reflected in its 2X 2016E sales multiple," says Goldman's Heath Terry, maintaining his Buy rating and cutting the price target to $24 from $25.
- BAML downgrades to Neutral from Buy.
- Pandora is now lower by 31.2% to $13.20.
- Previously: Pandora down 19.7% on soft Q4 guidance, Q/Q listener drop (Oct. 22)
- Previously: Pandora Media EPS in-line, misses on revenue (Oct. 22)
Fri, Oct. 23, 9:14 AM
Thu, Oct. 22, 6:15 PM
- In addition to slightly missing Q3 revenue estimates (while posting in-line EPS), Pandora (NYSE:P) is guiding for Q4 revenue of $325M-$330M, below a $351.9M consensus. No explanation is provided in the earnings release for the outlook.
- Active listeners (pressured by a variety of rivals) totaled 78.1M at the end of Q3, up from 76.5M a year ago but down from 79.4M at the end of Q2. Likewise, Q3 listener hours totaled 5.14B, +3% Y/Y but -3% Q/Q.
- Ad revenue +31% Y/Y to $254.7M, with local ad sales rising 52% to $63.5M. Subscription/other revenue rose 26% to $56.9M. Ad RPM (revenue per thousand listening hours) rose 28% to $56.84 - PC ad RPM was $71.88, and mobile/connected device ad RPM $54.31. Mobile revenue rose 36% Y/Y to $255.2M (82% of total revenue).
- Pandora has plunged to $15.41 after hours.
- Q3 results, PR
Thu, Oct. 22, 5:37 PM
Wed, Oct. 7, 9:12 AM
- Shortly following a Re/code report stating a deal is close, Pandora (NYSE:P) has officially announced it's buying small venue-focused online ticket agency Ticketfly for $450M. The deal will have "a nearly equal balance of cash and stock."
- Pandora: "The combination of Pandora and Ticketfly will solve the longstanding problem of event discovery by seamlessly connecting Pandora's nearly 80 million monthly active music fans to events they'll love. This will enable artists and promoters to sell out more shows and will strengthen the bond between artists and their fans. The companies will also harness the power of their combined data to create new tools for music makers to increase their revenue and improve recommendations for fans to enhance their overall music experience."
- Ticketfly sold 16M tickets last year for 90K+ live events, powers 600+ sites on behalf of clients, and sees an average of 14M monthly unique visitors to its main site and client sites. It provides ticket sales and marketing software for ~1,200 venues.
- Pandora has fallen to $21.45 premarket.
Tue, Sep. 29, 11:15 AM
- Stifel has hiked its Pandora (NYSE:P) target by $5 to $30, while reiterating a Buy.
- Following a rough 2014, the Web/mobile radio leader has outperformed in 2015, rising 20% in spite of a 3% drop for the Nasdaq. Shares go for 2.7x a 2016 sales consensus of $1.45B, after backing out net cash/investments.
- Shares rose last week after the CRB backed the admissibility of Pandora's deal with rights agency Merlin as a benchmark for recording royalty rates.
Mon, Sep. 21, 11:27 AM
- Pandora (NYSE:P) states the Copyright Royalty Board has affirmed the use of the company's deal with Merlin (a rights agency representing 20K+ indie music labels and distributors) as a valid benchmark for broader recording royalty rates.
- The Merlin deal, inked in 2014, reportedly features a statutory royalty rate if Merlin labels and artists receive a normal amount of airplay, and a lower rate if they receive more airplay.
- Trade group SoundExchange has been pushing for higher royalty rates. Pandora's payments to SoundExchange account for a big chunk of its content acquisition costs, which in turn equaled 46% of revenue in Q2.
- Shares have pared the initial gains seen on reports of a CRB decision, but remain sharply higher.
- Update (12:25PM ET): Pandora has issued a PR regarding the CRB's ruling. Spokesman Dave Grimaldi: "We are pleased that the Copyright Office affirmed the admissibility of Pandora's agreement with Merlin as a valid benchmark in the Copyright Royalty Board proceedings ... We look forward to the certainty that Decembers decision will bring, and are prepared to thrive in a number of potential outcomes."
Mon, Sep. 21, 10:23 AM
- After starting the day lower, Pandora (P +10.5%) has shot higher over the last 10 minutes. Shares have been halted twice for volatility.
- There are rumors the company won a favorable Copyright Royalty Board ruling. A CRB ruling on Pandora's royalty rates is expected to have a major impact on the company's content acquisition costs.
- Update (10:59AM ET): Bloomberg (citing Susquehanna) reports Pandora has won a favorable preliminary CRB decision. Shares are now up 6.4%.
Fri, Jul. 24, 12:45 PM
Fri, Jul. 24, 9:17 AM
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