Spotify beats estimates, but has a long climb to redeem past highs

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Spotify

 

If you’re looking into the tech vertical, don’t forget audio – for example, right now, tech journalists are pointing out that Spotify is up 5% over the last market cycle, based on positive numbers released this week.

A Reuters team reports Spotify saw monthly active users increase by 19% to around 422 million, with a revenue increase of 24%.

The coverage reveals that the firm put $1 billion into podcasts, including the Joe Rogan experience, which lately raised controversy, putting both the brand-name and the individual podcaster’s name in the spotlight. The exit of big names like Neil Young, and the threat of others, raised lots of questions about the extent to which controversy should determine platforming outcomes, as the society as a whole focuses on the real effects of social media and digital publicity.

For reference, though, it’s important to note that SPOT remains at profound five your lows, at just over 25% of all-time highs set within the year.

The current share price is actually about two thirds of the stock’s value in April 2018, when it stood around $140 per share.

At $100 per share as of press time, it has a lot of room to grow.

As for the numbers, initial estimates were higher, but executives reveal that they had to bake in the effect of closing off service to Russia during the Ukraine war.

“Our premium subscribers grew 15 percent year-over-year to 182 million,” said spokespersons, according to coverage by George Szalai at The Hollywood Reporter (syndicated to Yahoo News online). “While this is slightly below our guidance, after excluding the involuntary churn of approximately 1.5 million subscribers as a result of our exit from Russia, growth was above expectations and aided by outperformance in Latin America and Europe.”

Traders might see this new numbers when as an inflection point to get back into SPOT, but its past record does not inspire a lot of confidence.

Do your research, and think about whether this streaming giant is a long-term growth stock.

 

 

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