Breakingviews - New Spotify release gives bull-market vibes

2022 with 205 million paid subscribers, a 14% year-on-year increase. The New York-listed company also added 33 million monthly active users, which made the fourth quarter of 2022 its best ever for user growth. The shares leapt almost 10%, boosting Spotify’s market capitalisation to roughly $21 billion.

That’s surprising in one sense. Shareholders are effectively turning a deaf ear to profitability, which jars with their recent focus on margins. Spotify’s fourth-quarter operating loss was bigger than in the previous three-month stretch, while free cash flow turned negative. Recently announced layoffs may help to keep costs down, but Ek doesn’t have a huge amount of scope for flexibility, assuming he still wants to invest heavily in newer areas like audiobooks.

Because they haven't invested in anything for a long time. Their app interface is still horrible

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