Spotify just proved that the streaming music business is a like a black hole — and investors might not see it until it’s too late (AAPL, GOOGL, AMZN)

Spotify CEO Daniel Ek worried sad

  • Spotify released its financial results Wednesday as part of the paperwork it filed to become a public company.
  • The results show just how difficult the streaming business is, even for the market leader.
  • Investors shouldn’t expect Spotify to ever become a big money maker.

If you hadn’t figured this out already, the streaming music business is a terrible one to be in.

That’s the chief takeaway from the financial paperwork Spotify filed Wednesday in advance of becoming a public company. Despite dominating the subscription music market, the company generates relatively little money per user, has to give away nearly all the money it generates to the big recording companies, and continues to rack up losses.

And, as the company warned potential investors, things may never get much better.

“There can be no guarantee as to when we will eventually reach profitability, if at all,” the company said in it regulatory filings.

It’s been clear from the years and years worth of losses Pandora has posted that streaming music can be a tough business. But one would have hoped that Spotify would be in a much better position. After all, by some measures, the company has been wildly successful.

Spotify dominates the streaming music business

Not too long ago, there were plenty of doubters around who wondered if consumers would ever give up buying songs and albums in favor of paying a monthly subscription. Now, subscriptions generate far more money for the music industry than paid downloads, thanks in no small part to Spotify.

The company has 159 million monthly active users from around the world, 71 million of which pay a monthly subscription fee to use its service. Despite facing off against some of the biggest and most powerful companies in the world, including Apple, Google, and Amazon, Spotify has more than held its own. Its number of paying subscribers is about double that of Apple Music, the no. 2 player in the streaming music market.

Even though it’s already huge, Spotify continues to grow rapidly. Its number of monthly active users jumped 29% last year. And as impressive as that growth is, Spotify is having even more success convincing users to pay for its service. Its number of premium subscribers grew 46% in 2017.

All that growth has helped lead to improving financial results. The company’s sales jumped 39%.

Thanks to contracts it renegotiated with the major record labels last year, Spotify now gets to keep more of the money it takes in from subscribers and advertisers, helping it improve its bottom line. While its operating loss increased last year, the company actually shrunk that loss significantly as a portion of its revenue. And Spotify has generated free cash flow — the amount of cash yielded by a company’s operations less expenditures on long-term goods and assets like property and equipment — for the last two years.

But it hands over nearly all its revenue to the record labels

It sounds like everything is moving in the right direction, right? So what’s not to like?

Well, as impressively as Spotify has performed and as big of an impact as it’s had on the music industry, its business is still nothing to get excited about. Even with the renegotiated contracts, Spotify still has to pay out huge royalty fees to the big record labels.

After paying out those fees and a few assorted other costs directly related to providing its streaming service, the company is left with only around 21 cents of every dollar it takes in. And that’s before it has to pay for advertising or research and development.

Those costs are a big reason why Spotify doesn’t seem to have ever posted a full-year profit. Last year, for example, it lost about $1.5 billion on $5 billion in sales. Even if you back out a big one-time financing expense it recorded and some much smaller finance-related income, the company would still have lost $461 million on its operations alone.

If you exclude certain non-cash charges, as Wall Street analysts are fond of doing, Spotify’s operations actually generated money. Just not a whole lot. Last year, the company produced $133 million in free cash flow, up from $89 million the year before.

To put those numbers in perspective, Spotify generated about 84 cents of cash for every monthly active user it had last year, up from about 72 cents the year before. All those $10 a month subscriptions it sells and ads it posts on its free service? They added up to less than a $1 per user — for the whole year.

The company is hemmed in by user expectations and deep pocketed rivals

And you shouldn’t expect Spotify to ever generate lots of cash, even it it does eventually become profitable.

Here’s why.

The appeal to consumers of music streaming services like Spotify is that they offer access to practically all recorded music for a relatively affordable price.

Tim CookAs such, the services are completely dependent on the music labels to grant them access to their libraries — and they have to pay whatever the labels think is fair. Right now, that’s somewhere in the neighborhood of 80 cents of every dollar — but that price could up.

Spotify could try to pull a Netflix and publish more artists on its own, rather than having to license all the songs and albums from the big music labels. 

But the Netflix model won’t translate to Spotify. 

That’s because unlike Netflix, Spotify couldn’t get away with offering a more tailored selection of content. Consumers expect access to a universe of music when they subscribe to a streaming service. It’s different than TV, which is more hit-driven. 

If Spotify goes narrow, it becomes a nice-to-have service for consumers, instead of the must-have universal music service that consumers will gladly let Apple, Google or Amazon charge their credit cards for every month. 

And that points to the fundamental “catch-22” problem in the streaming music business.

You can’t go narrow. But if you go broad there’s little to differentiate the streaming services. They all basically offer the same proposition. Sure, the apps consumers use to access them are different, and some offer better features than others, but consumers basically get the same thing from each one for the same basic price. That close competition limits Spotify’s ability to raise prices or differentiate its service.

And while music is Spotify’s entire business, it’s a just side hustle for Spotify’s bigger rivals. Apple Music helps sell iPhones. For Amazon, music helps make its Prime subscription service more attractive. Those companies can afford to run their music businesses at breakeven or even at a loss, because they’re making their money elsewhere. Spotify doesn’t have that luxury — but its sales and costs will likely be influenced by such factors.

So don’t get too excited about Spotify’s impending debut on the public markets. Yes, it dominates streaming music. But that position isn’t worth a whole lot.

SEE ALSO: Spotify, the music streaming service that’s crushing Apple Music, just filed to go public in a very weird way

MORE BI PRIME: Here’s why Spotify is bypassing the normal IPO process — and why more companies don’t do it

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Barbra Streisand confirmó que clonó a su perra muerta no una, sino dos veces

Barbra Streisand Y El Ataque De Los Perros Clones

La clonación de animales no es algo nuevo, desde hace varios años hemos escuchado de esta práctica que inicio con la famosa oveja Dolly. Hasta ahora, todas las noticias en torno a clonaciones mantenían cierta distancia con el mundo real, ya que la gran mayoría (al menos las públicas) se mantenían como proyectos de investigación. Pero esto podría cambiar de forma radical al encontrarnos con el primer caso de una mascota clonada, no una, sino dos veces.

Barbra Streisand acaba de conceder una extensa entrevista a Variety, donde habló de varios aspectos de su vida, actuación y postura ante el movimiento #MeToo en la antesala de los Oscar. Pero de todas sus palabras, hay algo que está acaparando los titulares de todos los medios en el mundo, ya que la actriz de casi 76 años confirmó que clonó dos veces a su perra que murió en 2017. Continue reading “Barbra Streisand confirmó que clonó a su perra muerta no una, sino dos veces”

THE INSURANCE AND THE IoT REPORT: How insurers are using connected devices to cut costs and more accurately price policies


This is a preview of a research report from BI Intelligence, Business Insider’s premium research service. To learn more about BI Intelligence, click here.

Insurance companies have long based their pricing models and strategies on assumptions about the demographics of their customers. Auto insurers, for example, have traditionally charged higher premiums for parents of teenage drivers based on the assumption that members of this demographic are more likely to get into an accident.

But those assumptions are inherently flawed, since they often aren’t based on the actual behaviors and characteristics of individual customers. As new IoT technologies increasingly move into the mainstream, insurers are able to collect and analyze data to more accurately price premiums, helping them to protect the assets they insure and enabling more efficient assessment of damages to conserve resources.

A new report from BI Intelligence explains how companies in the auto, health, and home insurance markets are using the data produced by IoT solutions to augment their existing policy pricing models and grow their customer bases. In addition, it examines areas where IoT devices have the potential to open up new insurance segments.

 Here are some of the key takeaways:

  • The world’s largest auto insurers now offer usage-based policies, which price premiums based on vehicle usage data collected directly from the car.
  • Large home and commercial property insurers are using drones to inspect damaged properties, which can improve workflow efficiency and reduce their reliance on human labor.
  • Health and life insurance firms are offering customers fitness trackers to encourage healthy behavior, and discounts for meeting certain goals.
  • Home insurers are offering discounts on smart home devices to current customers, and in some cases, free devices to entice new customers.

In full, the report:

  • Forecasts the number of Americans who will have tried usage-based auto insurance by 2021.
  • Explains why narrowly tailored wearables could be what’s next for the health insurance industry.
  • Analyzes the market for potential future insurance products on IoT devices.
  • Discusses and analyzes the barriers to consumers opting in to policies that collect their data.

To get your copy of this invaluable guide to the IoT, choose one of these options:

  1. Subscribe to an ALL-ACCESS Membership with BI Intelligence and gain immediate access to this report AND over 100 other expertly researched deep-dive reports, subscriptions to all of our daily newsletters, and much more. >> START A MEMBERSHIP
  2. Purchase the report and download it immediately from our research store. >> BUY THE REPORT

The choice is yours. But however you decide to acquire this report, you’ve given yourself a powerful advantage in your understanding of insurance and the IoT.

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Telstra’s rolling out a free NBN speed upgrade to users on its slower plans

Telstra has announced that it will upgrade close to a million of its NBN customers to a faster speed tier at no additional cost.

Over 850,000 users on the NBN 25 plan (25Mbps/6Mbps, download/upload speeds) will have their plan upgraded over the next few months to the NBN 50 plan (50Mbps/20Mbps) as the company begins to offer its Standard Plus tier as the new flagship service.

Home and business customers don’t need to do anything to access the upgrade – Telstra will automatically perform the switch in the background and notify you when it’s been completed. However, there’s no word if this upgrade will be rolled out to every existing 25Mbps/6Mbps plan.

Eternal internet

For all new customers signing up to a home or small business NBN bundle, they’ll not only receive this Standard Plus tier by default, but they’ll also score the newly announced Telstra Smart Modem.

This particular modem has advanced Wi-Fi capabilities, but more impressively, it comes with an integrated 4G connection that allows you to use the modem when your regular connection is down. That's a handy feature for when you're moving house or first switching to the NBN, meaning you’ll never be without internet.

It is, however, worth noting that the maximum speed of the backup 4G connection is capped at 6Mbps for downloads and 1Mbps upload, and they "may vary", so it is definitely intended as a backup.

from TechRadar – All the latest technology news

PlayStation Plus March 2018: all the free PS4 games you can get this month

Are you a PlayStation Plus subscriber on the hunt for free PS4 games? Welcome! We've rounded up all the free games and discounts for the month of March down below so you can enter 2018 in style – plus, you'll find the deals from prior months, too. 

The best perks of being a PlayStation Plus subscriber is that, each month, you’re given a range of free games across the PS4, PS3 and PS Vita platforms.

This is a great way to try games you might not otherwise have played, whether because they're indie titles that slip under your radar or simply because you don’t have the funds to buy several games a month.

Even if you don’t plan to play them straight away, or you’re not sure if they’re your kind of game, we’d say it’s always worth claiming them while you can get them for free; you'll then have access to them for as long as you have an active PS Plus account. 

Since this is a monthly event, we’ve decided to create a one-stop shop where you’ll be able to find the newest free games, as well as scroll back and see which games were featured in previous months. That way you’ll know whether it’s worth holding out for a game to appear in an upcoming PlayStation Plus haul or if it's already been offered. 

So without further ado, here are the free PlayStation Plus games in North America, Europe and Australia for March 2018.

March 2018

March 2018 promises to be one the biggest months for free PS Plus games to date, with FromSoftware's classic PS4-exclusive Bloodborne leading the charge, followed by Insomniac's excellent Ratchet & Clank reboot.

Bloodborne – PS4 – usually $19.99 / £29.99 / AU$47.95

From the creators of Dark Souls comes Bloodborne, a gothic action-RPG that sees you battle hordes of beasts while trying to terminate the source of a plague that has turned the city of Yharnam's inhabitants into infected maniacs. 

Ratchet & Clank – PS4 – usually $19.99 / £29.99 / AU$52.95

A visually-stunning reboot that brings two of PlayStation's greatest mascots into the 4K and HDR era, Ratchet & Clank is joyous and inventive sci-fi shooter that happens to be family friendly.

Legend of Kay – PS3 – usually $29.99 / £24.99 / AU$29.95

A young cat-like warrior is tasked with protecting his people from invading gorillas and rats using his superior martial arts skills. 

Mighty No. 9 – PS3 – usually $19.99 / £15.99 / AU$24.95

From the creator of Mega Man comes Mighty No. 9, a spiritual successor that features near-identical platform-based shooter gameplay. It wasn't especially well-received, but you can't argue with 'free'.

Claire: Extended Cut – PS Vita/PS4 – usually $24.99 / £13.99 / AU$25.95

An innovative survival horror game, Claire: Extended Cut mixes modern and retro pixel-art style with 2.5D gameplay that reacts to the decisions that you make. It's also got multiple endings, too!

Bombing Busters – PS Vita/PS4 – usually $6.99 / £5.79 / AU$10.45

Clearly inspired by the Bomberman series, this puzzle game sees you take on a number of mazes and face off against large opponents using only the bombs at your disposal. 

February 2018

RiME – PS4 – usually $29.99 / £29.99 / AU$47.95

Sporting a beautiful art style and terrific animation, RiME is a third-person adventure game about a boy who washes ashore a mysterious island after witnessing his father's death. We promise he doesn't become the Green Arrow.

Knack – PS4 – usually $19.99 / £3.99 / AU$7.55

Created by PlayStation legend Mark Cerny, Knack was one of the PlayStation 4's launch titles, and was intended to become one of the brand's signature mascots. Err, good luck with that, Sony!

StarBlood Arena – PSVR – usually $19.99 / £24.99 / AU$39.95

Test your mettle in StarBlood Arena – an action-packed arena combat game that sees you face off against space pilots from all over the galaxy. 

Spelunker HD – PS3 – usually $16.99 / £7.99 / AU$14.95

Technically a remake of the 1985 NES port of Tim Martin's classic Spelunker arcade game, Spelunker HD not only sports a high-def makeover, it also boasts over 100 brand new levels.

Mugen Souls Z – PS3 – usually $19.99 / £15.99 / AU$24.95

A Japanese RPG that features turn-based, open-field combat, Mugen Souls Z sees its spunky main protagonist Chou-Chou attempt to dominate the seven prettiest planets in the universe. Not to be confused with Dark Souls.

Exiles End – PS Vita – usually $9.99 / £7.99 / AU$14.95

A throwback to the action-adventure games of the Commodore 64 and Amiga era, Exiles End is a platformer that should appeal to fans of games like Another World and Flashback.

Grand Kingdom – PS Vita/PS4 – usually $39.99 / £11.99 / AU$24.95

It's a good month for fans of Japanese role-playing titles, with Grand Kingdom offering a different kind of experience to Mugen Souls Z by bringing classic beat 'em up and board game elements into its gameplay.

January 2018

Deus Ex: Mankind Divided – PS4 – usually $59.99 / £49.99 / AU$99.95

With its skillfully combined FPS and RPG elements, the Deus Ex series has always felt that little bit more cerebral than its more traditional shooter brethren. Mankind Divided is no different with its branching narrative structure and open-ended gameplay. 

Batman: The Telltale Series – PS4 – usually $24.99 / £24.99 / AU$39.95

Away from the combat-focused Arkham games, Batman has also featured in a much more story-focused game recently. Telltale's Batman games follow the company's classic adventure template, having you solve puzzles and choose your way through an open-ended story that never goes the same way twice. 

StarBlood Arena – PSVR – usually $19.99 / £24.99 / AU$39.95

You'll need both a PlayStation VR headset as well as a PS4 console, but StarBlood Arena is a fun multiplayer-focused shooter where you pilot a ship through zero-gravity arenas, shooting everything in your sights. 

Sacred 3 – PS3 – usually $14.99 / £15.99 / AU$17.95

A hack 'n' slash from the developers behind the Saints Row series, Sacred 3 lets you and up to three friends take on hoards of enemies as you fight to secure the future of Ancaria. 

Book of Unwritten Tales 2 – PS3 – usually $19.99 / £19.99 / AU$39.95

While PS4 owners get the Telltale Batman game to adventure their way through, PS3 owners have Book of Unwritten Tales 2 to enjoy. It's a point and click adventure game that riffs on popular fantasy stories from Harry Potter to Lord of the Rings. 

Uncanny Valley – PS Vita/PS4 – usually $12.99 / £11.59 / AU$21.95

Your PS Vita/PS4 crossplay game this month is Uncanny Valley, a story-focussed survival horror game where you solve mysteries in an 'isolated facility'. 'Meaningful consequences' are promised for your actions, so you have been warned.

Psycho-Pass: Mandatory Happiness – PS Vita – usually $29.99 / £34.99 / AU$54.95

We'll level with you – we hadn't heard of Psycho-Pass until it showed up on PS Plus this month. However, with happiness deemed to be mandatory right there in the title, it might be worth giving Psycho-Pass a spin. 

December 2017

Darksiders II: Deathinitive Edition – PS4 – usually $29.99 / £24.99 / AU$39.95

Like Zelda meets God of War, the Darksiders series places players in the shoes of one of the Four Horsemen of the Apocalypse as they set off on an incredibly epic journey. Darksiders II sees you play as Death, who embarks on a quest to prove the innocence of his brother, War, who was the protagonist of the first Darksiders game.

Kung Fu Panda: Showdown of the Legendary Legends – PS4 – usually $9.99 / £11.99 / AU$17.95

Showdown of the Legendary Legends is an action-packed brawler based on, you guessed it, the Kung Fu Panda series of animated films. Enjoy up to 4-player couch co-op. 

Xblaze Lost: Memories – PS3 – usually $39.99 / £24.99 / AU$44.95

An anime visual novel based on the BlazBlue series from Arc System Works, so you probably already know if you're into this kind of thing. If not, you play as a pink-haired heroine who must make her way through an alternate reality to save her sister.

Syberia Collection – PS3 – usually $29.99 / £24.99 / AU$44.95

An adventure series from developer Microïds, Syberia sees you play as Kate Walker, a representative of her law film that travels across Europe on an adventure she never expected. 

Forma 8 – PS Vita/PS4 – usually $9.99 / £7.99 / AU$14.95

This 'Metroidvania'-style adventure game sees you take control of a little robotic ball that enjoys killing stuff and solving environmental puzzles. Notable for its striking visual aesthetic, Forma 8 is well regarded by critics.

Wanted Corp – PS Vita – usually $11.99 / £9.49 / AU$17.95

A top-down action game where you play as intergalactic bounty hunters, Wanted Corp offers fast and furious co-op action.

November 2017

Until Dawn: Rush of Blood – PSVR – usually $19.99 /  £15.99 / AU$24.95

Looking for a horror game on PSVR? Until Dawn: Rush of Dawn is the ticket. A scary roller coaster ride through a house of horrors, Rush of Blood has you shooting targets as you compete with friends and foes for a top leaderboard spot.  

Worms Battlegrounds – PS4 – usually $24.99 / £19.99 / AU$30.95

A blast from the past, Worms Battlegrounds pits teams of wriggling, anthropomorphic invertebrates against one another in a match to the death. Just as great for multiplayer as it is for single-player, Worms Battlegrounds brings the two decades-old franchise into the modern era.   

Bound – PS4 – usually $19.99 / £15.99 / AU$29.95

Bound is a game about the power of dance. Part platformer, part crazy choreography, Bound is absolutely beautiful. 

R-Type Dimensions – PS3 – usually $9.99 / £7.99 / AU$14.95

If you've never played a bullet hell side-scrolling shooter, today's your lucky day: R-Type Dimensions is available for free this month to PlayStation Plus subscribers. 

Rag Doll Kung Fu – PS3 – usually $9.99 / £7.99 / AU$7.75

Rag Doll Kung Fu: Fists of Plastic is a PS3 system exclusive party-fighting game with a … unique look and feel. The game focuses on fun with exaggerated physics action and charming HD visuals. 

Dungeon Punks – PS Vita – usually $14.99 / £11.99 / AU$22.95

Fast-paced action RPGs are all the rage these days, and Dungeon Punks is definitely capitalizing on that trend.  

Broken Sword 5: The Serpent’s Curse (Episodes 1 & 2) – PS Vita – usually $24.99 / £15.99 / AU$29.95

Broken Sword 5: The Serpent's Curse is the fifth installment in the long-running and popular point-and-click adventure series. This time around George and Nico are returning to Paris, hot on the trail of a stolen painting all while solving a murderous conspiracy. 

October 2017

Metal Gear Solid V: Phantom Pain – PS4 – (usually £24.99/ $19.99/ AU $39.95)

Amnesia: Collection – PS4 – (usually £23.99/ $29.99/ AU $42.95

Monster Jam Battlegrounds – PS3 – (usually £7.99/ $9.99/ AU $14.95)

Hustle Kings – PS3 and PlayStation Vita – (usually £9.99/ $9.99/ AU $19.45)

Hue – PS4 and PSVita – (usually £11.99/ $14.99/ AU $22.95)

Sky Force Anniversary – PS4 and PSVita – (usually £7.99/ $9.99/ AU $14.95

September 2017

inFamous: Second Son – PS4 – (usually $19.99 / £34.99 / AU$54.99)

Strike Vector Ex – PS4 – (usually $14.99 / £11.99 / AU$22.95)

Truck Racer – PS3 – (usually $9.99 / £10.99 / AU$16.95)

Handball 2016 – PS3 – (usually $19.99 / £19.99 / AU$29.95)

We Are Doomed – PS Vita – (usually $9.99 / £7.99 / AU$14.95)

Hatoful Boyfriend – PS Vita – (usually $9.99 / £7.99 / AU$14.95)

August 2017

Tokyo Jungle is the best kind of weird.

July 2017

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December 2016 

November 2016 

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August 2016 

from TechRadar – All the latest technology news

This smart home sensor sees through walls and could replace wearable fitness trackers

Your home needs radar, not motion-sensing cameras. And you can ditch those wearables when you’re at home, too. A new imaging sensing concept from Tel Aviv-based Vayyar Imaging is making waves with claims that its radio-based tech can image everything happening – even someone breathing – in a 3D space, and in real time.

One obvious target is the cameras in a smart home. Instead of motion-sensing security cameras, Vayyar's 3D imaging sensor tech can track people's minute movements without the need for video. It can even monitor breathing and heart-rate while someone sleeps. Critically, it does all of this without ever identifying someone. This is a tech about practicality, but also about protecting privacy.

"So basically we developed a radar, which runs a radio frequency technology – it's 'massive MIMO', just like 5G, and we can control the frequency," explained a spokesman at MWC 2018. "We can use very high frequency for high resolution images, and low frequency for better penetration in a building, and if you increase the number of antennas, your resolution increases." In that way, Vayyer's radio wave 3D imaging chip can be tuned to see through almost any object or material.

Walabot DIY in action at MWC 2018

Vayyer's biggest product so far is the Walabot DIY, a smartphone sensor now available on Amazon that finds obstacles in a wall, such as cables, studs and pipes. It's available only for Android phones. Next up is a product for elderly care that can tell if someone has fallen while in the bathroom; not a place where anyone would want a video camera. 

There are dozens of other possible uses for a tech that can not only detect any slight movements, but identify people by their patterns of movement. "You could use it tell how active someone is, and increase the air conditioning in the room someone is in," said the spokesman. That could be great in a gym. In fact, since it can also track sleep patterns, activity levels, and monitor vital signs, it could kill-off the need for wearables, at least while you’re at home. 

If it detects that you've gone to sleep, it can trigger the lights to dim, or cease. There are lots of other ways it could bring rooms, walls and doors to life; it could shut the elevator doors as soon as you get in if no-one else if nearby. It can see through walls to detect leaks. With so many potential uses, all Vayyar's tech needs is some impressive AI to make it useful.

Imaging on a bigger scale

Cue a deal in December last year with Japanese tech giant Softbank to collaborate on internet of things (IoT) projects. Details are brief, but it seems Vayyar’s sensor tech will be used with Softbank's AI to 'create buildings and infrastructure which are safer, more energy efficient and better able to handle large crowds'. 

One confirmed use is the structural integrity of buildings. Another is analyzing the flow of people using public transport. It's easy to see how being able to track the exact number of people moving through a space, and even monitor how fast they're moving, could have a use on busy thoroughfares, such as metro stations.

Like a lot of emerging tech, Vayyer is also aiming at the automotive industry. "We can know the exact position of people in the car, their posture, and whether it's a child or an adult in a seat, so we can control how airbags open," said the spokesman. Its concept of a 360-degree sensor is also being promoted as a technology for parking assistance and obstacle-avoidance. And when you go to open the door of a car, it can tell you if there's an obstacle in the way, including warnings about motorbikes that you might be about to decapitate.

Anything that means we don’t have to wear a Fitbit to bed gets our vote. 

MWC (Mobile World Congress) is the world's largest exhibition for the mobile industry, stuffed full of the newest phones, tablets, wearables and more. TechRadar is reporting live from Barcelona all week to bring you the very latest from the show floor. Head to our dedicated MWC 2018 hub to see all the new releases, along with TechRadar's world-class analysis and buying advice about your next phone.

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from TechRadar – All the latest technology news

Box is down over 13% after giving disappointing guidance (BOX)

Box CEO Aaron Levie

  • Shares for the enterprise file sharing platform Box were down more than 13% on Wednesday following the company’s fourth quarter 2018 earnings.
  • Box’s guidance for the current quarter, which ends April 30, came in below Wall Street expectations.
  • Earnings for the fourth quarter otherwise met analyst expectations, with $13.67 million in revenue, up 24% from the year before.

The cloud storage company Box saw its share slide down the proverbial cliff on Wednesday after reporting its latest quarterly earnings.

Shares traded around $20.84 per share after hours on Wednesday, down 13.36% from its price of $24.06 at the closing bell.

This drop follows the company’s revenue guidance for the current quarter, which fell well below Wall Street expectations. Box reported that it expects to see $139 million to $140 million in revenue for the quarter ending on April 30, while analysts expected the company to forecast $144.27 million. 

Box also told analysts that it expects to post a wider loss per share for the current quarter, too. The company said it expects adjusted losses between $0.08 and $0.09 per share, while analysts estimated losses of just $0.08. 

While the forecast was gloomier than expected, Box’s earnings report for the fourth quarter of 2018 was otherwise in line with Wall Street expectations. Box reported $136.7 million in quarterly revenue, up 24% from the year before. Analysts expected $136.71 million in revenue.

Box, which went public in 2015, is still not profitable. The company reported an operating loss of $32.5 million over the quarter on a GAAP basis, about 24% of its revenue. That’s a big uptick from the year before, when it saw an an operating loss of $32.5 million, or 33% of its total revenue. 

This in contrast to Dropbox, one of Box’s biggest competitors in the cloud storage space, which  filed its S-1 to go public late last week. Dropbox reported 300,000 paying teams on its platform, leading it to about $1.1 billion in annual revenues — though it’s not profitable, either.

SEE ALSO: Dropbox shows its freemium model works — 11 million users and 300,000 business teams are paying for its service

Join the conversation about this story »

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