Pandora comes up short in Q4


PandoraTotal revenue for Pandora Media in its fiscal Q4 (November-January) was $81.3 million. That was a 71% increase over Q4 a year earlier, but short of the $83 million that Wall Street had been expecting. So the company’s stock dropped in after-hours trading.

Pandora shares had closed at $14.27 when the closing bell sounded at the NYSE, a drop of 2.7% for the day. But after the earnings were released, the shares plunged more than 20% in after-hours trading.

The company also missed expectations for earnings per share. EPS was a negative five cents for the quarter, three cents worse than the analysts’ consensus expectation of negative two cents.

Despite the miss, CEO Joe Kennedy tried to put a positive spin on the quarter in his statement ahead of a conference call with analysts.

“The fourth quarter was a strong finish to fiscal 2012, which was highlighted by record revenue, radio market share, listening hours and active users. Reflecting on our first fiscal year as a public company, we have many accomplishments to be proud of and much to look forward to in the year ahead. Pandora continues to rapidly disrupt the radio industry and has only just begun to realize the potential of our$37 billionUS market opportunity,” said Kennedy.

Later, in his conference call with analysts, Kennedy tried to explain the miss. “First, holiday ad spending came in a few percent lower than expected. And second, the eCPMs [effective cost per thousand impressions] we saw on the remnant ad inventory we sold through third-party networks in January were lower than what we had modeled,” the CEO said.

For fiscal Q1 (February-April) Pandora is telling investors to expect revenues to be in a range of $72-75 million. EPS is expected to be negative 18-21 cents.