Croxon: Spotify will disrupt Apple
Spotify Technology SA (SPOT.N) investors, who have grown increasingly bullish on the music-streaming service since its shares began trading last month, were disappointed with its latest subscriber gains.
The company reported 75 million premium users in the first quarter, a 45 per cent increase from a year earlier. Though that was in line with the range of 73 million to 76 million that Spotify projected, the underwhelming results sent the shares down as much as 8.7 per cent.
The reaction suggests that Spotify shareholders were expecting breakout growth from the company, which listed its shares on the New York Stock Exchange last month. Spotify has pitched itself as the dominant player in music streaming, and Chief Executive Officer Daniel Ek has set out to claim the largest share of a market that should one day number several hundred million people.
The company’s stock fell as low as US$155.20 in extended trading. It had climbed 29 per cent over the past month.