Pandora Q1: Early Days For Programmatic, But Pegs Q3 For Launch

pandPandora CEO Brian McAndrews said during the digital radio company’s Q1 earnings call that its mobile programmatic solution, currently in beta, will be generally available in Q3.

“During beta, we are open to a handful of customers to ensure we are set up to operationally scale the program similarly to what we’ve done in web,” McAndrews told investors during the call. “We anticipate mobile programmatic will be generally available for advertisers early in the third quarter.”

Pandora’s reach, coupled with its focus on in-app mobile programmatic, sets the firm’s offering apart, according to McAndrews.

“This is a very big deal because approximately 85% of smartphone usage is spent in-app vs. on mobile web, while most ‘mobile programmatic’ offerings are on the mobile web,” he said.

Speaking to investors during a Q&A session following the firm’s prepared remarks, McAndrews was a bit more modest.

“This will take a little bit of time,” he conceded. “We don’t expect major returns in the near term.”

Pandora has 230 targeting segments available today, and McAndrews said it will continue to increase those segments within programmatic.

“[Programmatic] will provide us more capabilities in terms of importing our advertisers’ data, in addition to the data that we provide,” he said.

In terms of revenue, Pandora beat investors’ Q1 expectations, netting $230.8 million, a 19% jump YoY. Q1 ad revenue grew 27% YoY to $178.7 million.

Its Q1 mobile revenue totaled $181.1 million, a 23% YoY spike.

Pandora has also been pushing more deeply into local advertising, which grew in Q1 to $43.3 million, a 67% increase from 2014’s first quarter. Local now takes 24% of advertising revenue. Audio accounts for about two-thirds of total advertising, eclipsing both display and video.

Pandora, which has struggled to build monthly active users (MAUs) in recent quarters, has been vocal about its goal to grow MAUs to at least 100 million in the US in the long term – a goal it thinks the Internet of Things will help it to achieve.

Pandora missed its lofty goal on Thursday. Active listeners now numbered 79.2 million, up from 75.3 million the same time last year. This was a 3% sequential drop from Q4’s 81.5 million. Total listening time on Pandora, however, a signal of loyalty, reached a record high of 22.3 hours per active user per month.

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