Spotify's stock price reached an all-time high on Friday, January 24, fueled by strong forecasts for user growth and improved profitability. This performance reflects an overall positive trend in the music industry, with several music companies experiencing gains and exceeding earnings expectations.
Investors are showing strong confidence in Spotify's future, driving its stock price to record highs. On Friday, January 24, Spotify's stock reached an all-time high of $511.98, closing the week at a record $510.43, a 5.1% increase from the previous week. This performance values the company at an impressive $101.6 billion, a $5 billion jump in just one week. Spotify's stellar start to 2025, with a 14.1% surge in 15 trading days, is fueled by optimistic forecasts.
The Stockholm-based streaming giant anticipates 665 million monthly active users, a 25 million increase from the previous quarter, and 260 million premium subscribers, up from 252 million in the third quarter.This upward trajectory aligns with improvements in Spotify's gross margin, projected to reach 31.8% in the fourth quarter, up from 31.1% in the previous quarter. Meanwhile, Live Nation, a major player in the music industry, is also experiencing positive momentum. Live Nation's shares climbed 3.8% to $140.74 on Friday, narrowly missing the all-time high of $141.18 achieved on November 25, 2024. Evercore's recent boost in its Live Nation price target to $160 from $150 contributes to this positive outlook.The broader music industry is also reflecting this upward trend. The 20-company Billboard Global Music Index reached a new record of 2,303.31, a 3.5% increase from the previous week. This impressive performance brings the index's year-to-date gain to 8.4%, significantly exceeding the 3.7% and 3.3% gains of the S&P 500 and Nasdaq composite, respectively. A significant number of music stocks are contributing to this positive climate, with a dozen finishing the week in positive territory and three exceeding 5% gains. While eight stocks experienced declines, only one fell by more than 2%. Tencent Music Entertainment, a Chinese music streamer, emerged as the week's top performer, surging 7.4% to $11.59. Morgan Stanley's upgrade of Tencent Music to “overweight” from “equal weight” on Tuesday, January 21, likely contributed to this strong performance. K-pop company SM Entertainment also saw a notable increase, gaining 7.1% to 84,000 won ($58.76), bringing its year-to-date growth to 11.1%. Cumulus Media closed the week at $0.88, up 4.8%, following news of a major shareholder's interest. SiriusXM, however, experienced a 1.4% decline to $21.96, despite Morgan Stanley's recent lowering of the company's price target to $21 from $23. SiriusXM has struggled this year, with a 3.7% year-to-date decline and a 58.9% loss over the past 52 weeks. Deezer, a French music streaming platform, faced the week's biggest setback, dropping 7.3% to 1.15 euros ($1.21). Deezer's shares have shed 46.5% over the past 52 weeks and are already down 14.2% in 2025.Overall, the music industry appears to be on a strong trajectory, with positive earnings reports and rising stock prices. The positive sentiment is attributed to a combination of factors, including increased user engagement, robust subscription growth, and improving margins. The upcoming earnings releases from music companies, starting with SiriusXM on January 30, will provide further insights into the industry's performance and future prospects.
SPOTIFY STOCK PRICES MUSIC INDUSTRY EARNINGS GLOBAL MUSIC INDEX LIVE NATION TENCENT MUSIC ENTERTAINMENT SM ENTERTAINMENT CUMULUS MEDIA SIRIUSXM DEEZER
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