Analyst Jason Bazinet from Citi maintained a Hold rating on Spotify and keeping the price target at $750.00.
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Jason Bazinet’s rating is based on Spotify’s recent strategic changes in pricing and subscription tiers in emerging markets. The company has introduced new pricing structures, including a Premium Platinum tier, which is not aligned with the anticipated ‘Superfan’ offering but rather focuses on increasing average revenue per user (ARPU) in these regions. This shift indicates a strategic pivot from subscriber growth to enhancing revenue from existing users.
While the new pricing strategy might bolster Spotify’s top-line growth, the changes are limited to a small percentage of Spotify’s Premium subscribers, specifically in countries like India, Indonesia, Saudi Arabia, South Africa, and the UAE. Additionally, the elimination of Family and Duo plans for new users could push more subscribers towards the higher-priced Platinum tier, potentially increasing revenue but also posing a risk of user attrition. These factors contribute to the Hold rating, reflecting a balanced view of potential revenue growth against the risks of subscriber churn.
In another report released on November 8, TR | OpenAI – 4o also reiterated a Hold rating on the stock with a $666.00 price target.
SPOT’s price has also changed slightly for the past six months – from $620.070 to $645.330, which is a 4.07% increase.