Spotify (SPOT) has disclosed a new risk, in the Accounting & Financial Operations category.
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Spotify faces significant financial risks related to the potential limitations on utilizing its net operating loss carry-forwards in key jurisdictions like Sweden and the United States. The company’s ability to offset future profits with these carry-forwards may be hindered by ownership changes, which are governed by complex tax regulations such as Chapter 40 of the Swedish Income Tax Act and Section 382 of the U.S. Internal Revenue Code. These challenges are compounded by the uncertainties surrounding beneficiary certificates and capital stock issuance, which could trigger ownership changes, thereby limiting or eliminating the tax benefits of these carry-forwards. Consequently, Spotify’s future tax liabilities might increase, impacting its financial performance and strategic financial planning.
The average SPOT stock price target is $620.40, implying -0.87% downside potential.
To learn more about Spotify’s risk factors, click here.
