TLDR
- Spotify stock surged 15-18% Tuesday after beating Q4 earnings expectations with 4.43 euros per share versus 2.74 euros expected.
- Monthly active users jumped 11% year-over-year to 751 million, exceeding analyst estimates of 744.7 million.
- Premium subscribers grew 10% to 290 million despite multiple price increases across global markets throughout 2024 and early 2025.
- Spotify Wrapped 2025 was the most successful ever with over 300 million users interacting and 630 million social media shares.
- The company expects Q1 revenue of 4.5 billion euros but missed Wall Street estimates of 4.58 billion euros due to foreign exchange headwinds.
Spotify stock jumped 15% Tuesday after the music streaming platform crushed fourth-quarter earnings estimates and showed strong user momentum. The stock hit $489.72 in what appears to be the largest single-day percentage gain in company history.
The Swedish company reported earnings of 4.43 euros per share, well above the 2.74 euros analysts expected. Revenue reached 4.53 billion euros, slightly beating the 4.52 billion euro forecast.
Monthly active users climbed 11% year-over-year to 751 million. That topped the FactSet estimate of 744.7 million users.
Premium subscribers grew 10% to 290 million. The growth came even as Spotify raised prices multiple times across different markets.
The company increased premium subscription prices in the U.S. to $12.99 per month from $11.99 in January 2026. Before that, Spotify raised prices in August 2025 across South Asia, the Middle East, Africa, Europe, Latin America, and Asia-Pacific regions to €11.99 from €10.99.
Co-CEO Alex Norström said the company recorded the most users ever added during a single quarter. He credited growth in Latin America, Europe, and improvements to the mobile free tier.
Wrapped Feature Drives Engagement
Spotify’s year-end Wrapped feature hit record numbers. Over 300 million users interacted with the personalized listening summary in 2025.
The feature generated more than 630 million shares on social media. Spotify said it was the most successful Wrapped campaign ever.
Ad-supported users reached 476 million, beating the StreetAccount estimate of 468.9 million.
Content Expansion Beyond Music
The streaming platform expanded its content offerings during the quarter. Spotify launched audiobooks in Denmark, Finland, Sweden, Monaco, and Iceland.
Premium subscribers already get 15 hours of audiobook listening per month. The company announced last week that U.S. and U.K. users will be able to purchase physical books through the Spotify app via Bookshop.org this spring.
Spotify also rolled out music videos for premium users and added more artificial intelligence tools in Q4.
Norström said leading global publishers credited Spotify with bringing in new audiobook listeners and driving double-digit growth in the category.
Net income jumped to 1.17 billion euros, or 4.43 euros per share. That compared to 367 million euros, or 1.76 euros per share, in the year-ago period.
The gross profit margin reached 33.1%, topping Wall Street’s 32.9% forecast.
For the current quarter, Spotify expects monthly active users to grow by 8 million to 759 million. That surpasses the FactSet estimate of 752.4 million.
Total premium subscribers are forecast to hit 293 million in Q1.
Revenue guidance came in at 4.5 billion euros for the current quarter. The company cited a 670 basis point headwind from foreign exchange rates.
That fell short of the 4.58 billion euro analyst estimate. Spotify expects a gross margin of 32.8% versus Wall Street’s 32.1% forecast.
The stock had dropped 21% over the past 12 months before Tuesday’s rally. Investors had worried about decelerating revenue growth.
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