Spotify’s (SPOT) stock is up 10% after the music streaming platform issued bullish guidance for 2030 at its latest Investor Day presentation.
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Spotify has held its first investor day since 2022. At the event in New York City, the company forecast revenue at a compounded annual growth rate (CAGR) in the mid-teens and gross margins between 35% and 40% by 2030. Spotify also reiterated to plans to reach one billion global subscribers and $100 billion in revenues.
The bullish outlook has SPOT stock trading sharply higher on May 21. The move is no doubt welcome by shareholders who have had to watch as Spotify’s stock sank 16% this year. In the past 12 months, SPOT stock has declined 25%.
Spotify’s revenue by geography. Source: The Fly
What’s Next for Spotify
During Investor Day presentations, management highlighted that Spotify has added more than 340 million new users to its platform and grown its subscriber base by more than 110 million. The company also continues to convert users to its top-tier premium subscription.
That said, Spotify has struggled with a shifting music industry, fueled by the growth of artificial intelligence (AI). Much of the decline in SPOT stock has been due to investor fears that AI will disrupt Spotify’s audio streaming model. The company has responded by diversifying and adding more audiobooks and podcasts to its platform.
Is SPOT Stock a Buy?
Spotify’s stock has a consensus Strong Buy rating among 24 analysts. That rating is based on 20 Buy and four Hold recommendations issued in the last three months. The average SPOT price target of $591.09 implies 20% upside from current levels.
