MENA-focused music streaming service Anghami published its preliminary unaudited Q3 results on Tuesday (November 15).
The platform saw revenue jump 29% year over year in Q3 to $31.7 million, from $24.5 million in Q3 2021, driven by increased subscriptions.
It also posted 27% quarter-on-quarter growth in subscription revenue, Anghami said without disclosing the actual figures.
For the quarter ended September 30, the company says that its gross profit rose 13% versus Q2, which it attributed to an 8% increase in ARPU (average revenue per user).
Also within the report, the company revealed that it has slashed its headcount by 22% and reduced its cloud computing costs by 19%.
The company did not disclose the exact number of employees that it had to let go.
As of the end of 2021, Anghami had 174 full-time and part-time employees across Abu Dhabi, Beirut, Cairo, Dubai and Riyadh, according to a June filing.
A 22% reduction in its headcount translates to about 38 affected employees.
Anghami is the latest technology company to turn to a headcount reduction to reduce costs.
Online shopping giant Amazon is expected to make a 3% reduction to its workforce, which translates to around 10,000 jobs, while Facebook parent Meta is reducing its own workforce by around 13%, or 7,000 jobs.
“Given the impact of challenging macroeconomic conditions, we had to take some cost disciplinary measures to improve our bottom-line performance.”
Eddy Maroun, Anghami
Anghami on Tuesday acknowledged that it had to take “tough measures” to maintain its profitability.
“Given the impact of challenging macroeconomic conditions, we had to take some cost disciplinary measures to improve our bottom-line performance,” Eddy Maroun, CEO and co-founder of Anghami, said.
Following the announcement, Anghami’s shares fell 5% on Tuesday and slipped by another 7% on Wednesday on the Nasdaq. The company floated on the Nasdaq in February following its merger with a special purpose acquisition company (SPAC) called Vistas Media Acquisition Company.
Meanwhile, Anghami says it also carried out significant organizational and infrastructure investments in recent quarters, allowing it to get a more “efficient and streamlined organization.”
In the first half of the year, the Abu Dhabi-headquartered firm had 1.28 million paying subscribers, up 41% from a year earlier, which it attributed to “higher conversion rates of advertising-supported users to paying subscribers, as well as a higher number of active users”.
Its first-half revenue edged up 29% year over year to $21.1 million as the company is bullish on achieving “a record year for Anghami in 2022”.
Anghami had earlier said that “Arabic content is key” to its “future growth.”
Last month, the company launched a global competition on TikTok called “Sound of Saudi,” a talent search inviting Saudis in the country and around the world to participate to showcase their skills as singers, composers, producers, mixers, or instrumentalists.
Winners of the Saudi Music Commission-endorsed talent search will have their original work produced and made available via Anghami. The contest has so far received more than 390 million views with 5 million engagements and over 25,000 entries.
Anghami adds that local artists have been the focus of Spotlight Events, which it bought earlier this year. Spotlight Events, a company that specializes in managing and executing live events and concerts in the MENA region, is now Anghami’s arm for live events and concerts.
The company is set to open its first Anghami Lab Rooftop Lounge on Friday (November 18) as part of the Riyadh Season 2022 attractions located in the Riyadh Boulevard City entertainment hub of Merwas, the region’s biggest recording studios.
These ventures make Anghami more attractive as a music company amid reports that its bigger rival Spotify is considering buying the firm.
Earlier this month, Dubai-based Frankly magazine and Arabian Business reported that Spotify has shown interest in buying the company.
Frankly, citing a source, said “The idea was that Anghami would go public if Spotify showed interest in an acquisition, so a SPAC was proposed to speed up the takeover”.Music Business Worldwide