Pound for pound, Pandora ads now worth more than radio

Internet radio company Pandora (s P) reported the financial results for its first three months as a public company on Thursday. The Oakland, Calif.–based company confirmed that while it still has a long way to go before it reaches the listener levels of terrestrial radio, its ads are now just as valuable as traditional stations’.

Pandora posted total revenue of $67 million during the second fiscal quarter of the year, more than doubling its revenue from the same period one year ago. Revenue from ads accounted for the lion’s share of Pandora’s Q2 sales, totaling $58.3 million.

And while Pandora did not turn a bottom-line profit for the quarter — the company’s net loss was $1.8 million — it seems to be impressing Wall Street with the traction it has gotten thus far. On a phone call with investors and analysts after the stock market closed on Thursday afternoon, Pandora confirmed that pound for pound its ads are just as valuable as those broadcast on traditional radio.

One analyst said that in reading the company’s quarterly report, he calculated that Pandora is now “generating more ad revenue per 1000 hours than traditional radio is, with a tenth of the user base.” Pandora CEO Joseph Kennedy confirmed that the analyst’s calculations were “broadly correct” but added that it only pertained to the company’s web application, not its mobile apps. “It’s our belief that over the long term we can reach similar levels in mobile,” he said. Pandora saw 1.8 billion total listener hours in the second quarter, across approximately 100 million registered users. For the full year, Pandora expects to make between $270 million and $275 million in total revenue.

During the call, Kennedy also stressed that Pandora is still very small compared to traditional radio broadcasting — and that for investors, that should be a good thing. “We’ve penetrated less than four percent of the U.S. radio market. We simply have tremendous room to grow.”