Spotify Stock Slumps 13% Despite Earnings Beat. Price Hikes Are a Problem - Barron‘s
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Spotify (SPOT) dropped 13% after reporting an earnings beat but missing premium subscriber expectations (299M vs 300M consensus).
The article highlights concerns that recent price hikes ($11.99→$12.99) are deterring customers, while profit guidance also fell short.
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Spotify Stock Slumps 13% Despite Earnings Beat. Price Hikes Are a Problem - Barron‘s
By George Glover
Updated April 28, 2026 10:20 am EDT / Original April 28, 2026 6:41 am EDT
https://www.barrons.com/articles/spotify-earnings-stock-price-1e566b9b
\- Spotify stock fell after forecasting 299 million premium subscribers, below Wall Street’s 300 million expectation.
\- Spotify reported first-quarter adjusted earnings of 3.45 euros per share on €4.5 billion revenue, an 8% jump year-over-year.
\- Concerns arose that recent premium subscription price hikes, from $11.99 to $12.99, are deterring potential customers.
Spotify Technology stock was tumbling on Tuesday after the Swedish audio streamer forecast disappointing premium subscriber growth, fueling worries that recent price hikes are putting off customers.
Shares slid 13% to $428.68 in early trading. The S&P 500 was 0.4% lower.
For the first quarter, Spotify reported adjusted earnings of 3.45 euros ($4.03) a share, as revenue jumped 8% from a year ago to €4.5 billion. Analysts were expecting a profit of €2.95 a share on sales of €4.5 billion, according to a FactSet poll.
The company’s weak subscriber growth outlook overshadowed the earnings beat. Spotify expects to add six million premium subscribers over the current quarter, taking the total figure to 299 million. Wall Street was forecasting that it would pass the 300 million mark.
That could fuel worries that would-be customers aren’t willing to pay up for a subscription in a tough economic environment. The company raised the monthly cost of an individual premium subscription in the U.S. to $12.99 from $11.99 in February.
Spotify’s profit guidance for the current quarter also came in light. The streamer expects an operating income of €630 million, well below the €680 million that analysts were looking for.
The outlook “implied higher operating expenses, which are weighing on the stock this morning,” Deutsche Bank analyst Benjamin Black, who rates Spotify at Buy with a $675 price target, said in a research note.
Black added that investors could also do with more clarity about the company’s artificial-intelligence strategy, given several competitors are leaning into AI-generated music.
Shares could have done with a boost. They were already down 15% for the year, dragged down by worries about whether Spotify would be able to grow its margins fast enough to justify a lofty valuation. The stock was fetching 33-times expected earnings for 2026 as of Monday’s close
Subscriber guidance missed by 1M, and Q2 operating income forecast of €630M was below €680M consensus. Stock trades at 33x forward earnings – high multiple leaves little room for growth disappointments. Price hikes are slowing subscriber additions, and rising costs pressure margins; near-term momentum is negative. Earnings beat (€3.45 vs €2.95) shows profitability improving; Deutsche Bank analyst maintains Buy with $675 target; AI music strategy could unlock future growth.