Spotify Technology on Tuesday beat analyst estimates for subscribers and users in the fourth quarter. It also topped views on revenue, but earnings were lighter than expected. Still, Spotify stock surged on the news.
The streaming music giant earned the equivalent of $1.88 a share on sales of $4.53 billion in the December quarter. Analysts polled by FactSet had expected earnings of $2.07 a share on sales of $4.32 billion. In the year-earlier period, Spotify lost 39 cents a share on sales of $3.94 billion. The Stockholm-based company reports financial results in euros.
Spotify added 11 million premium subscribers in the fourth quarter. Analysts had expected Spotify to add 7.9 million subscribers. It ended 2024 with 263 million subscribers worldwide.
Also, Spotify tallied 675 million monthly active users in the fourth quarter vs. Wall Street's target of 664 million. Spotify offers an ad-supported service in addition to its commercial-free subscription service.
For the current quarter, Spotify forecast revenue of $4.34 billion, vs. the consensus estimate of $4.33 billion. In the year-earlier period, it generated $3.89 billion in sales.
Further, it expects to add 2 million premium subscribers, ending the March quarter with 265 million. Plus, it is targeting 678 million monthly active users, up 3 million.
Spotify Stock Is On Three IBD Lists
On the stock market today, Spotify stock jumped 13.2% to close at 621.77.
On Jan. 22, Spotify stock broke out of a cup base at a buy point of 506.47, according to IBD MarketSurge charts.
"I am very excited about 2025 and feel really good about where we are as both a product and as a business," Chief Executive Daniel Ek said in a news release.
He added, "We will continue to place bets that will drive long-term impact, increasing our speed while maintaining the levels of efficiency we achieved last year. It's this combination that will enable us to build the best and most valuable user experience, grow sustainably and deliver creativity to the world."
Spotify stock is on three IBD lists: Leaderboard, Big Cap 20 and Tech Leaders.
Follow Patrick Seitz on X, formerly Twitter, at @IBD_PSeitz for more stories on consumer technology, software and semiconductor stocks.
