Pocket FM, a growing audio based platform that provides serialized audio content in various genres, is experiencing fast revenue growth fueled by microtransactions and advertising.
Pocket FM, disclosed a total revenue of Rs 1,051.97 crore for the financial year 2023-24, marking a significant growth of around 6 times from Rs 176.36 crore in the preceding financial year.
During this period, its losses decreased to Rs 165 crore compared to Rs 208 crore in the previous financial year. The surge in revenue was mainly fueled by subscription earnings from microtransactions, which amounted to Rs 934.73 crore in FY24, a substantial increase from just Rs 160 crore in the prior year.
“This year (FY25), we are expecting about 80 per cent growth in revenue for our business,” Anurag Sharma, chief financial officer (CFO), Pocket FM.
“All our businesses across geographies are operating at almost positive gross margins. If we are operating on a negative cash flow trajectory, it is largely because of our investments in content – we initially have to invest heavily in creating content and then distribute it,” he added.
Pocket FM’s current market focus are the US and India, but it has also recently forayed into Europe and Latin America. Pocket fm competes with audio platforms Kuku FM, Spotify and Amazon’s Audible in the space.
Founded in 2018 by Rohan Nayak Nishant KS and Prateek Dixit, Pocket FM secured $103 million in its Series D funding round in March, led by Lightspeed and joined by Stepstone Group. Currently, the company has raised $196.5 million in total funding and was valued at $750 million in its last equity round. Soon after the fundraise, Pocket FM conducted its first ESOP buyback worth $8.3 million.
Pocket FM’s competitor Kuku FM reported two-fold year-on-year jump in its revenue to Rs. 88 crore in FY24. The IFC and Fundamentum Partnership-backed firm reduced its losses by 18% to Rs 96 crore.
Pocket FM operates on a freemium model where it provides users with 15 minutes of free listening for each audio series. After that, users have the option to buy coins priced between Rs 50-100. These coins can then be used to unlock additional episodes.
In FY24, Pocket FM saw more than 45 million microtransactions, boosting its revenue growth worldwide.
CFO Sharma mentioned that over 30 of Pocket FM’s audio series generated over Rs 10 crore each, with seven surpassing Rs 100 crore. The company also logged over 100 billion minutes of streaming from its 200 million listeners in FY24.
Additionally, more than 40,000 AI audio series contributed to revenue exceeding Rs 25 crore.
