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Catalysts (optional)

User Growth and Engagement Will Remain The Focus Over Profitability
Streaming Economics Will Favour The Suppliers, Users AND The Aggregators.
Being An Audio Platform Will Lead To Less Reliance on Variable-Cost Music
The Market Will Come To Understand Spotify’s Current and Future Profitability

Assumptions (optional)

Retain Dominant Market Share Position In Paid Music Streaming
- 325m paid subs by 2028 (35% of 930m market).
ARPU to Climb From Price Increases And New Revenue Streams
- From €4.5 to €7
- Revenues of €27.3bn
Gross Margins to Rise From New Deals And Revenue Sources
- From 24.1% to 30% by 2028
Net Cash Flow Margins To Improve Dramatically
- From 1.5% to 9% by 2028
- €2.46bn in FCF by 2028

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Disclaimer

Michael1234 is an employee of Simply Wall St, but has written this narrative in their capacity as an individual investor. Michael1234 holds no position in NYSE:SPOT. Simply Wall St has no position in the company(s) mentioned. This narrative is general in nature and explores scenarios and estimates created by the author. The narrative does not reflect the opinions of Simply Wall St, and the views expressed are the opinion of the author alone, acting on their own behalf. These scenarios are not indicative of the company's future performance and are exploratory in the ideas they cover. The fair value estimate's are estimations only, and does not constitute a recommendation to buy or sell any stock, and they do not take account of your objectives, or your financial situation. Note that the author's analysis may not factor in the latest price-sensitive company announcements or qualitative material.