Audio platform Pocket FM has surpassed the ₹1,000 crore revenue mark in the financial year 2023-24 on the back of growth in microtransactions and advertising revenues.
The audio platform revenue came in at ₹1,051.97 crore in FY24, as compared to ₹ 176.36 crore in FY23. The growth was primarily driven by increase in microtransaction-led subscription revenue, which rose to ₹ 934.73 crore in FY24.
The company also narrowed its losses by 21 percent to ₹165 crore in FY24, from ₹208 crore loss in FY23.
“Micro transactions contribute 85 per cent of their overall revenue, while our advertising revenue has doubled from 7-8 per cent to 15 per cent and is expected to grow further, potentially contributing 25-30 per cent of revenue in the future,” Pocket FM CFO Anurag Sharma told businessline.
Sharma noted that the US accounts for 70 per cent of the firm’s revenues followed by India.
The firm’s expense-to-earnings ratio improved to 1.16 in FY24, down from 2.18 in the previous year. The company is also focused on optimising costs and improving operational efficiency in its push for profitability.
“Our focus will always remain on growth first. I think profitability is a by choice definition for us. Even if we were to remove or lower our marketing spends, we could be profitable at any given point of time. We are focusing more on user engagement, their experience, retention on our platform, and creating more diverse content to target different sets of users. Profitability will be a byproduct of our growth”, Sharma said.
‘Blockbuster engine’
The company also invests in content as it expands into new markets across Europe, Latin America, Canada, Australia, and New Zealand.
Pocket FM is leveraging AI to build a ‘blockbuster engine’ that will help it to identify which shows to launch and which ones to promote to users. “In the content business, one of the important elements is how do you identify blockbuster shows,” he noted.
The firm said more than 40,000 AI audio series have generated more than ₹25 crore in revenue, so far, in 2024.
Founded in 2018 by Rohan Nayak, Prateek Dixit, and Nishanth Srinivas, Pocket FM offers more than 75,000 audio series on its platform spanning genres. The company raised $103 million led by Lightspeed in March. It has raised $196.5 million financing to date.