Spotify stock dives 17% as dim user forecast overshadows revenue beat – Seeking Alpha

Spotify, Podcasts, Music and other Apps on iPhone screen

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Spotify stock (NYSE:SPOT) has tanked 17.2% after hours following a fourth-quarter earnings report where revenues outperformed and its loss wasn’t as bad as expected, but user guidance for the current quarter fell just short of expectations.

Revenues grew 24% to €2.69 billion, beating an expected €2.65 billion. Of that, premium revenues were up 22% to €2.3 billion vs. an expected €2.28 billion.

The company’s loss per share improved substantially, to -€0.21 from a year-ago -€0.66.

User growth for the quarter, meanwhile, essentially met expectations. Monthly active users rose 18% to 406 million, in line with forecasts, and total premium subscribers rose 16% to 180 million. Ad-supported MAUs came in at 236 million. And average revenue per user was better than expected at €4.40

On the other hand, it’s expecting a slow start to 2022. It’s forecasting monthly active users of 418 million, short of consensus for 422 million – and premium subs of 183 million vs. an expected 185.3 million. And revenues are forecast in line with expectations at €2.6 billion.

The company also no longer plans to issue annual guidance “since the vast majority of our initiatives are multi-year in nature and measured as such.” But quarterly guidance will serve as checkpoints against progress. On those, it plans to simplify by providing one estimate for each metric rather than a range of outcomes.

Finally, it’s planning an investor day later this year “to offer an update on the strength of our platform and our advancement towards our long-term operating goals.”

Conference call/Q&A to come at 4:30 p.m. ET.

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