Pandora (P) seems to be doing a good job of standing up to the arrival of Apple's (AAPL 1.27%) iTunes Radio.
Pandora put out encouraging metrics for the month of November this morning. It served up 1.49 billion hours of content, up 17% from the 1.27 billion hours it delivered a year earlier. Pandora's unique listeners have risen 16% over the past year to 72.4 million. However, savvy investors know better than to rely on Pandora's year-over-year performances. Apple introduced iTunes Radio in mid-September, providing owners of the growing number of portable iOS devices easy access to free ad-supported streams in Pandora-esque fashion.
Apple turned heads by initially revealing that 11 million listeners had flocked to the service during its first week; a month later, Apple was claiming to have served up a billion tunes to 20 million listeners. Apple's rookie success likely caused Pandora investors to start gnawing away at their fingernails, and things didn't get any easier when Pandora posted a sequential decline in active listeners for the month of October.
After attracting 72.7 million listeners in September, just 70.9 million folks fired up Pandora in the first full month of competing against iTunes Radio. The silver lining then was that at least the amount of content being consumed rose sequentially, even accounting for the extra day in October. Thankfully, we're seeing sequential improvement on both metrics for November. Pandora now accounts for a record 8.44% of all U.S. radio listening, and that's a ringing endorsement for the audio-streaming platform.
Pandora bears looking to nitpick will be quick to point out that November's unique listeners still clocked in lower than September's tally. That's true, but instead of worrying about where 1.8 million listeners went between September and October, we now have just a net decline of 0.3 million users during the past two months. Is the market expanding, or did some of the people abandoning Pandora to check out iTunes Radio come back?
The important metric is ultimately that the actual content consumed continues to rise -- listener hours have gone from 1.36 billion in September to 1.49 billion last month -- at a time when Pandora is getting better at monetizing its streams. Revenue in Pandora's latest quarter soared 50% despite a mere 17% increase in usage.
Naturally, investors will want to keep a close eye on the metrics that Pandora graciously provides on a monthly basis. You aren't likely to see Apple offer up this kind of insight, so we're down to seeing if the world of options weighs on Pandora's service in any given month. For now, Pandora's holding up just fine against Apple -- and the rest of the world.
