Spotify Reports Record User Growth and Revenue in Q4
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Feb 10 2026
0mins
Should l Buy SPOT?
Source: Investing
Spotify's stock rose 4.70% as it reached a 20-day high, driven by impressive user growth and revenue figures.
The company added a record 38 million monthly active users in Q4, surpassing management's guidance of 32 million, bringing the total audience to 751 million. Additionally, Q4 revenue rose 13% year-over-year to €4.5 billion, supported by an expanding user base and improved profitability, with gross margin expanding to 33.1%. Despite these strong fundamentals, Spotify faces pressure from high market expectations and competition from giants like Apple and Amazon.
This strong performance highlights Spotify's market leadership and ability to attract users, but the company must navigate competitive pressures and market expectations to maintain investor confidence.
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Analyst Views on SPOT
Wall Street analysts forecast SPOT stock price to rise
21 Analyst Rating
15 Buy
6 Hold
0 Sell
Moderate Buy
Current: 531.170
Low
525.00
Averages
750.79
High
900.00
Current: 531.170
Low
525.00
Averages
750.79
High
900.00
About SPOT
Spotify Technology SA a Luxembourg-based company, which offers digital music-streaming services. The Company enables users to discover new releases, which includes the latest singles and albums; playlists, which includes ready-made playlists put together by music fans and experts, and over millions of songs so that users can play their favorites, discover new tracks and build a personalized collection. Its users can either select Spotify Free, which includes only shuffle play or Spotify Premium, which encompasses a range of features, such as shuffle play, advertisement free, unlimited skips, listen offline, play any track and audio. The Company operates through a number of subsidiaries, including Spotify LTD and is present in over 20 countries. Its service offers a music listening experience without commercial breaks.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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See More
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- New Parental Controls: Spotify is introducing additional parental controls for all account types.
- Enhanced User Experience: These controls aim to provide a safer and more tailored listening experience for families.
See More
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- Strong User Growth: Spotify's fourth-quarter revenue rose 13% year-over-year to €4.5 billion, adding a record 38 million monthly active users, bringing the total to 751 million and surpassing management's guidance of 32 million, indicating robust user acquisition despite stock pullback.
- Profitability Improvement: The company expanded its fourth-quarter gross margin to 33.1%, an 83-basis-point increase from the previous year, demonstrating stronger profitability across both premium and ad-supported tiers, alleviating concerns about royalty payments capping profit potential.
- Valuation Pressure: Despite strong fundamentals, Spotify's stock has declined 17%, trading at a forward P/E ratio of about 33, reflecting high market expectations for continued revenue growth and margin expansion; however, management expects only 3 million new premium subscribers in Q1 2026, a significant drop from 9 million in Q4, which may impact market confidence.
- Increased Competitive Risks: Spotify faces intense competition from tech giants like Apple, Alphabet, and Amazon; while it currently leads the market, these companies can price their streaming services more aggressively as they do not rely on them for standalone profitability, increasing pressure on Spotify's market position.
See More
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- Sustained Revenue Growth: The company's Q4 revenue rose 13% year-over-year to €4.5 billion, driven by an expanding user base and improved profitability, further solidifying its market leadership position.
- Improved Profitability: Spotify's gross margin expanded to 33.1% in Q4, an 83-basis-point increase from the previous year, indicating stronger profitability across both its premium subscribers and ad-supported free tier.
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- Technical Analysis Tool: Comparing the current share price to the 200-day moving average can provide valuable insights for investors, helping them assess market trends and make more informed investment decisions.
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- Inflows and Outflows Monitoring: Weekly monitoring of changes in shares outstanding helps identify ETFs with significant inflows or outflows, where inflows necessitate purchasing underlying assets, while outflows may lead to selling, affecting individual stock performance.
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