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Spotify (SPOT) is the world's top music streaming service, delivering over 100 million songs, 7 million podcasts, and 350,000 audiobooks to 713 million monthly users, including 281 million paid subscribers. Its freemium model offers free ad-supported listening or ad-free Premium plans with offline downloads and high-quality audio. Features like personalized playlists, AI DJ, social sharing, and Spotify Wrapped keep users hooked, while artists gain tools for promotion and earnings through streaming royalties.
Founded in 2006, the company is headquartered in Stockholm, Sweden, with operations in over 180 countries.
Spotify Stock Slides
Spotify's stock has shown mixed results lately, dropping 16% over the past five days, 27% in the last month, 32% over three months, and 37% in six months. Year-to-date (YTD), it's down 28%, with 52-week returns at -32% while trading 47% off its 52-week high of $785. Despite short-term slides, two-year gains stand strong at 81%.
Against the Russell 1000 Index, Spotify lagged sharply short-term; its losses significantly outpaced the index's milder dips of around 1.5% and 0.70%. Over 52 weeks, SPOT's 32% drop trailed the index's 43% rise, reflecting sector-specific pressures amid broader market resilience.
Spotify's Results Shine
Spotify delivered impressive third-quarter 2025 results on Nov. 4, 2025. Revenue rose 12% year-over-year (YoY) to €4.3 billion ($4.99 billion equivalent), beating analyst estimates of €4.23 billion. EPS hit €3.28 ($3.84), crushing forecasts of €1.97 ($1.87) by over 66%, up from €1.54 last year.
Premium subscribers grew 12% to 281 million (met expectations), with monthly active users up 11% to 713 million (beat 710 million estimated). Gross margin improved to 31.6% (up 56 bps), operating income reached €582 million (€97 million above guidance), and free cash flow hit €806 million, showing strong cash generation.
For Q4, Spotify guided revenue to €4.5 billion (below the €4.56 billion estimated), premium subscribers to 289 million (under 291 million), and monthly users to 745 million (above 739.5 million). The operating income outlook was €620 million, signaling continued profitability focus.
Spotify is also scheduled to release its fourth-quarter results on Feb. 10, 2026.
Spotify Enters Physical Book Market
Spotify is diving into physical books through a partnership with Bookshop.org. Starting this spring, U.S. and UK Premium subscribers can buy hardcovers and paperbacks right in the Spotify app.
Bookshop.org manages pricing, stock, and shipping. Spotify acts as a referral hub, supporting independent bookstores, since Bookshop shares profits with local shops. This boosts small retailers while Spotify takes on giants like Amazon (AMZN) and Barnes & Noble.
The move taps into booming demand for print books among young readers, fueled by TikTok's BookTok trend. Viral videos drive sales of specific titles, making book buying fun and social.
Barnes & Noble rode this wave, growing from 600 stores at its low to 721 by late 2025 after opening dozens yearly. It plans 60 more in 2026. Spotify complements this with features like Page Match, syncing print pages to audiobooks for seamless switching.
Should You Buy SPOT Stock?
Despite the recent falloff in the market, Spotify is still backed by analysts who have a consensus “Strong Buy” rating and a mean price target of $733.26, reflecting an upside of 75% from the market price.
SPOT stock has been analyzed by 36 market experts, receiving 24 “Strong Buy” ratings, three “Moderate Buy” ratings, and nine “Hold” ratings.
On the date of publication, Ruchi Gupta did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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