Music streaming leader Spotify Technology on Tuesday beat expectations for subscribers and listeners in the fourth quarter. Spotify stock popped higher on the news.
The Stockholm-based company added 10 million premium subscribers in the December quarter. Analysts had expected 8.9 million new subscribers. Spotify ended the period with 236 million total paying subscribers worldwide.
Also, Spotify tallied 602 million monthly active users in the fourth quarter vs. Wall Street's target of 601 million. Spotify offers an ad-supported service in addition to its commercial-free subscription service. Its monthly active users rose 23% year over year.
The audio entertainment service lost the equivalent of 39 cents a share on sales of $3.95 billion in the fourth quarter. Spotify reports financial results in euros. Analysts polled by FactSet had predicted Spotify would lose 40 cents a share on sales of $4.01 billion. In the year-earlier period, Spotify lost $1.52 cents a share on sales of $3.44 billion.
Spotify Stock Is A Recent Breakout
In afternoon trades on the stock market today, Spotify stock jumped 3.8% to 231.77. Earlier in the session, it notched a two-year, regular-session high of 248.67.
Spotify's improved profitability in the fourth quarter is the result of corporate restructuring actions taken late last year.
For the current quarter, Spotify expects to add 3 million premium subscribers. It also predicted reaching 618 million total monthly active users in the March quarter.
Spotify forecast revenue of 3.6 billion euros ($3.87 billion) in the first quarter.
In addition to music, Spotify offers subscribers podcasts and audiobooks.
On Jan. 12, Spotify stock broke out of a flat base at a buy point of 202.88, according to IBD MarketSmith charts.
Spotify stock is on IBD's Leaderboard.
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