TLDR
- Spotify stock climbed 15% Tuesday after delivering Q4 earnings of 4.43 euros per share, well above the 2.74 euro consensus.
- The streaming service’s monthly active users rose 11% year-over-year to 751 million, topping analyst forecasts of 744.7 million.
- Premium memberships grew to 290 million despite subscription price increases to $12.99 in the U.S. and €11.99 internationally.
- Spotify Wrapped 2025 drew 300 million users and produced 630 million social shares, marking the feature’s strongest performance ever.
- The company guided Q1 revenue to 4.5 billion euros, below Wall Street’s 4.58 billion estimate due to currency exchange headwinds.
Spotify stock rallied 15% Tuesday following a strong fourth-quarter earnings report that exceeded analyst projections across major metrics. Shares rose to $489.72 in what represents the streaming platform’s best single-day gain on record.
The company posted earnings of 4.43 euros per share for the December quarter, nearly doubling the 2.74 euro Wall Street estimate. Revenue reached 4.53 billion euros, topping the 4.52 billion euro consensus.
Monthly active users expanded 11% from the prior year to 751 million. The total beat FactSet’s forecast of 744.7 million users.
Premium subscribers grew 10% to 290 million. Growth continued despite Spotify raising prices in multiple markets over the past year.
The company lifted U.S. premium subscription costs to $12.99 per month from $11.99 in January. International prices increased to €11.99 from €10.99 in August 2025 across South Asia, the Middle East, Africa, Europe, and Latin America.
User Growth Hits All-Time High
Co-CEO Alex Norström said the quarter delivered the highest user additions ever recorded in a single period. He pointed to strong gains in Latin America and Europe, combined with upgrades to the mobile free tier.
Ad-supported users reached 476 million, surpassing StreetAccount’s 468.9 million estimate.
Net income climbed to 1.17 billion euros from 367 million euros in the year-ago quarter. Earnings per share rose to 4.43 euros from 1.76 euros.
Gross profit margin came in at 33.1%, beating the 32.9% Wall Street projection.
Wrapped Feature Drives Engagement Records
Spotify’s year-end Wrapped campaign posted record numbers in 2025. More than 300 million users engaged with the personalized listening recap feature.
The campaign generated over 630 million shares across social media platforms. Spotify called it the most successful Wrapped rollout in the feature’s history.
The platform broadened its content library during Q4. Audiobooks launched in Denmark, Finland, Sweden, Monaco, and Iceland.
Premium members get 15 hours of audiobook access monthly. Spotify also plans to let U.S. and U.K. users buy physical books through its app via Bookshop.org this spring.
The service added music videos for premium subscribers and expanded AI-driven features in the quarter. Norström said major publishers recognized Spotify for bringing in new audiobook listeners and fueling double-digit category growth.
For Q1, Spotify projects monthly active users will hit 759 million, above FactSet’s 752.4 million estimate. Premium subscribers are expected to reach 293 million.
Revenue guidance for the current quarter stands at 4.5 billion euros. The forecast missed analyst estimates of 4.58 billion euros due to a 670 basis point foreign exchange headwind.
Spotify expects Q1 gross margin of 32.8%, higher than Wall Street’s 32.1% forecast. The stock had fallen 21% over the prior 12 months before Tuesday’s surge as investors questioned whether revenue growth could sustain momentum.
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