Spotify Stock Pulls Back After Hitting $400 Record High Despite TikTok Music Exit

Spotify Stock Pulls Back After Hitting $400 Record High Despite TikTok Music Exit

By Marcus Bennett

November 17, 2024 at 10:29 PM

Spotify stock (NYSE: SPOT) has experienced a slight cooling after reaching a record high of nearly $400 per share, following TikTok Music's shutdown announcement. The stock closed at $369.20, down 3% from opening and approximately $20 below its 52-week high.

Spotify stock price chart

Spotify stock price chart

Key Factors Affecting Spotify's Current Position:

  • Multiple analysts predict SPOT growth, with some targeting $500 per share
  • Concerns exist about subscriber growth and content costs
  • Q3 2024 earnings release scheduled for November 12th after market close
  • Company-wide insider trading blackout currently in effect

Notable Changes from 2021:

  • Reduced wasteful spending
  • Increased focus on profitability
  • Implementation of price increases
  • Expansion into audiobooks and video content

Risk Factors:

  • Monthly-user miss in Q2 (offset by strong subscriber numbers)
  • Potential slowdown in user additions
  • Heavy reliance on expectations of continued growth and profitability
  • Recent 17.9% reduction in holdings by Select Equity Group to 141,000 shares

The upcoming Q3 earnings report will be crucial for determining SPOT's trajectory, particularly regarding subscriber growth and profitability metrics. The after-hours earnings release timing mirrors Q3 2022, when the company missed guidance for margin and operating income.

Businessman checking phone with charts

Businessman checking phone with charts

Concert stage with colorful lights

Concert stage with colorful lights

Man presenting Spotify Now Playing feature

Man presenting Spotify Now Playing feature

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