Leading music streaming service Spotify on Wednesday announced a long-awaited initial public offering, seeking up to $1 billion as it lists its shares on the New York Stock Exchange.
In its filing, the Swedish company indicated confidence that streaming will keep up its soaring growth but also acknowledged that Spotify is still deep in the red.
The papers filed with the Securities Exchange Commission offered the most detailed look yet at the finances of the decade-old company. It said it had 159 million monthly users including 71 million paying subscribers -- twice that of closest rival Apple Music.
Spotify said its revenue jumped by more than 38 percent in 2017 from a year earlier to 4.09 billion euros ($4.99 billion). But its net loss widened sharply to 1.24 billion euros ($1.51 billion).
"We have incurred significant operating losses in the past, and we may not be able to generate sufficient revenue to be profitable, or to generate positive cash flow on a sustained basis," the company said as it listed the risk factors.
Led by 35-year-old Daniel Ek, the streaming service has led a major shake-up of the global recorded music industry which for the past two years has produced solid growth for the first time since the jolt of the internet era.
Spotify in its filing boasted that it finally found a way to monetize online music after years of piracy and free online content.
"We set out to reimagine the music industry and to provide a better way for both artists and consumers to benefit from the digital transformation of the music industry," it said.
"Spotify was founded on the belief that music is universal and that streaming is a more robust and seamless access model that benefits both artists and music fans."
Spotify boasts a library of 35 million songs that users can access instantly online. Despite loud protests against the company in the past by artists ranging from Taylor Swift to Radiohead, virtually all well-known Western musicians now stream their music on Spotify or its rivals.
Charting out the risks, the company said it had faced six lawsuits since July alleging unlawful reproduction or distribution.