SPOT: Spotify Stock Tunes Out with 12% Drop After Surprise $100M Loss, Revenue Miss

The beat wasn’t the only thing that dropped on Tuesday. Swedish streamer couldn’t get in the groove of the earnings season and CEO Daniel Ek is “unhappy” about where the company is today.

📀 Worst Day in Two Years

• Spotify stock SPOT tumbled 12% Tuesday for its worst day in two years. Investors hit the pause button after the streaming giant posted a surprise net loss of €86 million ($100 million) for the second quarter — or 42 euro cents per share. It was a sharp reversal from last year’s €1.33 profit.
• The results were far off beat: analysts had expected a profit of €1.98 per share. While revenue rose 10% year-on-year to €4.19 billion, it still missed expectations of €4.26 billion — and that was enough to knock the wind out of Spotify’s recent rally.
• Spotify's American depositary receipts (ADRs) slid double digits in early cash trading. Despite the drop, shares of the Swedish streamer are up 36% year-to-date — but lower by about 20% from the record high a couple months ago.

🎵 Subscribers Tune In

• The bright spot? Spotify added 8 million premium subscribers, beating forecasts for 5 million and bringing its total to 276 million paid users. Monthly active users (MAUs) rose 11% to 696 million.
• That growth helps justify Spotify’s top-line ambitions — but it wasn’t enough to offset concerns about profitability and margin pressure.
• The company guided for 281 million premium subs and 710 million MAUs next quarter, alongside revenue of €4.2 billion. But after this quarter’s miss, Wall Street wants execution, not just expansion.

🥁 BPM vs EPS?

• “While I’m unhappy with where we are today, I remain confident in the ambitions we laid out for this business,” said CEO Daniel Ek, striking a candid but forward-looking tone on the earnings call.
• Spotify has spent big on AI-powered personalization, podcasting, and global expansion — but the payoff hasn’t hit the bottom line yet.
• The question now is whether Spotify can convert user growth into sustainable profits — or whether it’ll keep streaming losses quarter after quarter.