The company filed its financial report with Companies House in the UK and showed revenue of £7.28 million. Not only is that up nearly 75% from 2008, the cost of sales was £7.2 million, leaving the company with a gross profit of just more than £86,000.
As Music Ally points out, however, the company is still reporting net liabilities of £22.24 million. Still, the company says that parent corporation CBS makes funds available to the service as needed.
In 2009, the bulk of Last.fm's revenues, 73.7%, came from advertising sales. Subscriptions accounted for £1.3 million in revenue. Most of Last.fm's revenues come from the UK, with 33.5% coming from the U.S.
It also looks like Last.fm's decision to move away from on-demand streaming should further help it edge closer to profitability, seeing as administrative costs were down more than £10 million from 2008.
That makes sense, especially when you compare Last.fm's financials with that of UK-based Spotify. Spotify reported a loss of more than $26 million in 2009.
What's equally interesting is that although Spotify had higher revenues than Last.fm, its cost of sales was significantly higher. It takes more than just subscriptions and buzz to make an online music venture profitable.