Spotify Stock Plunges 7.15% on User Growth Concerns
1min read On April 29, 2025, Spotify Technology's stock experienced a significant drop of 7.15% in pre-market trading, driven by investor concerns over the company's second-quarter monthly active user (MAU) projections falling short of expectations.
Spotify's first-quarter performance showed a 10% increase in monthly active users to 678 million, aligning with company guidance. Premium subscribers grew by 12% to 268 million, surpassing analyst expectations. This growth was buoyed by a strong user base and expanding video offerings, which have attracted more users to the platform.
However, the company's decision to raise subscription prices in Europe and Latin America by 1 euro, effective as early as June, has raised concerns among investors. This price increase, while not affecting the U.S. market, could impact user retention and growth in these regions. The last price adjustment in the U.S. occurred in July 2024, where the monthly fee increased from the initial $9.99 to the current $11.99.
Despite these challenges, Spotify remains a dominant player in the music streaming industry, with nearly 700 million monthly active users and over 250 million paying subscribers. The company's strategic expansions and innovative offerings continue to drive user engagement and revenue growth, positioning it well for future success.
