Spotify forecasts €670 million Q3 operating income, shares slip premarket
Spotify just announced that its Q3 profit forecast is a bit underwhelming, projecting €670 million in operating income, which missed what analysts were hoping for.
The main reason? User growth has slowed down in big markets like North America and Europe.
After the news dropped, Spotify's shares slipped nearly 4% in premarket trading on Tuesday.
Spotify adds AI features, Merlin deal
Even though Q3 looks shaky, Spotify actually beat expectations last quarter with strong profits and revenue growth.
To win back users and stay ahead of rivals like YouTube and AI music apps, it's rolling out new AI-powered features like "Personal Podcasts" and the new offering "Reserved."
Plus, a fresh deal with Merlin means fans can legally use Spotify's upcoming paid tool for fan-made covers and remixing, with artists on labels under Merlin's Spotify agreement able to participate, so there's still plenty happening behind the scenes to keep things interesting.