Spotify

Spotify’s Q3 earnings exceeded revenue expectations, but Q4 guidance for revenue and subscriber growth disappointed investors, causing a stock dip. While EPS and revenue beat estimates, premium subscriber numbers fell slightly short. A recent price hike had limited short-term impact. Ad revenue declined, contrasting premium revenue growth. Despite this, MAUs exceeded projections, boosted by mobile free tier enhancements. Spotify is leveraging AI, partnering with labels and integrating with ChatGPT, while navigating brand challenges from CEO’s investment choices.

Spotify is partnering with major music industry players like Sony, Universal, and Warner Music to develop “responsible” AI products. This initiative aims to harness AI’s potential while respecting artist rights and copyright, addressing growing concerns about unauthorized AI usage in music. Spotify is investing in AI research, including a new AI lab, and has already integrated AI-powered features like AI DJ and AI Playlist. The collaboration focuses on partnerships, artist choice, fair compensation, and artist-fan connection, striving to shape an AI-driven music future that values human creativity.

Spotify CEO Daniel Ek will become executive chairman on January 1, 2026, with co-presidents Gustav Söderström and Alex Norström jointly taking over as co-CEOs. This leadership shift aims to streamline decision-making and foster innovation in the increasingly competitive audio streaming market. Ek will focus on long-term strategy, while the co-CEOs will manage day-to-day operations. The market is watching how this unconventional leadership structure impacts Spotify’s navigation of challenges like competition and evolving technologies.