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Spotify: The Sell-Off After Q1 Earnings Is A Gift
Amrita Roy · 2026-04-29 · via All Articles on Seeking Alpha

Summary

  • I am rating Spotify a 'buy' as valuation multiples have contracted since its peak in 2025, creating an attractive risk-reward profile despite recent post-earnings weakness.
  • SPOT's Q1 FY26 saw revenue of €4.5B (+8% YoY) and operating income of €715M, but forward guidance for Premium subscriber growth and operating profit disappointed.
  • Premium subscriptions drove over 91.5% of revenue, with ARPU remaining resilient even after a February 2026 price hike, though pricing fatigue is a concern.
  • AI-driven investments aim to deepen engagement and support freemium-to-premium conversion, while technical support at $344 and 40% upside to consensus PT underpin bullish positioning.
  • Looking for a portfolio of ideas like this one? Members of The REIT Forum get exclusive access to our subscriber-only portfolios. Learn More »
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Introduction & Investment Thesis

Spotify (SPOT) stock is down 44%+ from its all-time high since June 2025.

Yesterday, despite the company delivering a beat to both its revenue and earnings estimates in Q1 FY26, the

6.87K Followers

Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, but may initiate a beneficial Long position through a purchase of the stock, or the purchase of call options or similar derivatives in SPOT over the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.