Spotify Q1 2025 Earnings Miss Expectations Despite Year-Over-Year Growth

? Spotify Q1 2025 Earnings Miss Expectations Despite Year-Over-Year Growth

Spotify (SPOT) reported its Q1 2025 earnings, falling short of market expectations. The company posted adjusted earnings of $1.13 per share, significantly below the Zacks Consensus Estimate of $2.29, resulting in a negative earnings surprise of -50.66%. Although earnings were up slightly from $1.05 per share in Q1 2024, the result marked a considerable miss.

Quarterly Revenue Also Falls Short

Spotify generated $4.41 billion in revenue during the quarter, below the consensus estimate by 4.08%. This still represented a solid increase from the $3.95 billion posted in the same quarter last year.

This marks the third time in four quarters that Spotify has missed consensus earnings estimates, with only one beat in that time. On the revenue side, the company has exceeded expectations twice over the past four quarters.

Stock Performance

Despite the Q1 miss, Spotify shares are up 33.6% year-to-date, outperforming the broader S&P 500, which has declined by about 6% in the same period. This indicates strong investor sentiment, possibly due to long-term growth potential in streaming and podcasting.

Looking Ahead

The key question for investors is how Spotify plans to improve earnings consistency moving forward. Future performance may depend heavily on management’s forward guidance and commentary during the earnings call.

Changes in analysts' estimates and future earnings projections—closely tracked by rating systems like the Zacks Rank—could offer clues about the stock's next move