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Deeser welcomed a “milestone” in its development after its cash flow basis was destroyed for the first time since it was founded almost 20 years ago.
Results reported Tuesday evening said the Paris-based music streaming platform had its revenues rose 12% last year to 542 million euros.
It caused 4 million euros of interest, taxes, depreciation and amortization in 2024, but the improvements due to the 29 million euros loss in 2023 were broken for the first time in the second half of the year. The annual free cash flow was 7 million euros compared to last year’s 44 million euros, but before tax it was 27 million euros.
“For the first time in history, we are positive about cash flow and a massive milestone that will greatly change what we think about the future,” CEO Alexis Lantagnier told the Financial Times.
He said the move will allow the group to “invest in research and develop the right solutions to build a long-term pathway for growth and profitability.”
Founded in 2007, the French technology company faces tough competition from large rivals such as Swedish streaming groups Spotify, Apple Music and Alphabet Owned YouTube.
Deezer had around 10 million paying subscribers at the end of last year, against Spotify’s 263 million.
The company’s biggest investors are Leonard Blavatnik’s access industry, with the French telecom group Orange and the Pineau family of billionaires among its shareholders. It was one of France’s first privately owned “unicorns” with 1 billion euros, but since listing in 2022, its stock price has plummeted.
Deezer wants to launch new technology to enable a more personalized experience with the app, providing a direct, exclusive interaction between fans and artists.
Deezer has already agreed to labels such as Universal Music Groups, which say that artists who listen to at least 1,000 people a month receive a loyalty rate twice as much as those who don’t.
Lantanier said Deezer has moved to this “artist-centric” model. This model pays more artists who enable more streams, but the next shift is “user-centric… which means always pushing to make sure your subscription goes to the artist you are listening to.”
Deezer has developed an artificial intelligence detection tool on the platform. This hopes to protect the revenue of actual artists by excluding illegally trained songs with copyrighted songs. Illegal streams are identified and removed from the algorithms promoting the tracks, preventing these AI from receiving royalties on generated songs.
Deather has discovered that about a tenth of the approximately 700,000 new songs featured on the platform each week are fully generated by AI. “So that’s obviously something we need to fight,” Lantagnier said.
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Deeser focuses on driving growth in core markets such as France, Brazil, Germany and the UK, with high return on investment in areas such as marketing and reduced in other areas.
The group also worked closer to deal music labels to help increase artists’ value, reduce costs and increase subscription prices. This currently starts at 11.99 euros.
Deezer offers streaming technology as a “white label” platform for other consumer brands to launch music services.
“We’re growing 12% per year, which is very remarkable in an environment that isn’t as exciting as it was in the digital world,” said Lantagnier. “It’s a very good year to think hard on the long term path, because we have a much stronger financial situation where we can control our destiny.”
