Spotify Stock (SPOT) Hits An All-Time High Of $330
Image Credit: Heidi Fin
Spotify’s Stock Price Rocketed up by 118% in 2020
As we entered 2020, specifically Thursday 2nd January, Spotify stock (SPOT) sat at $151.62 per share. A seemingly low price in comparison to today’s valuing but was up considerably from September 2019’s approximation of $112 per share.
These gains disappeared as the uncertainty of Covid-19 came rolling through, affecting business all over the world, in particular the music business. SPOT dropped and sat at $109.18 per share but nevertheless managed to climb over 118% from the aforementioned value in early January.
By the end of April SPOT had regained its value it parted with during the initial coronavirus pandemic, causing a market shakeup. This led to a small rise in May ($192 per share) which was likely because of the announcement that the Stockholm-based platform was to be the official home of The Joe Rogan Podcast (JRE). This gave way to a sharp uptick finalising in the record high of $332 per share.
The extremely popular and successful program arrived on Spotify in September which led to speculation from investors around the earning potential of podcasts. Many of which voiced that non-music entertainment could enable the platform to obtain long-sought profitably. Although a successful streaming service is worth $28 billion, music margins are decidedly low for Spotify. The streaming giant shares almost identical libraries to other streaming competitors such as Apple Music, Deezer, Amazon Music. This is due to the big three labels (headed by UMG) put an end to exclusive releases many years ago.
Podcasts have opened the doors for expansion for Spotify which in turn should lead to increased profitability. There is an optimistic air among investors that Spotify can achieve long-term and large scale success moving forward. In fact other streaming services such as Amazon Music announced recently that they too would start hosting podcasts and will have several exclusives.
Not only did JRE come to Spotify in September Spotify also signed deals to host shows from Kim Kardashian West, Warner Media (specifically DC Comics), TikTok star Addison Rae and many more. The JRE was Spotify’s most popular podcast and took this position in just one month. Although, behind the scenes there was some opposition from certain Spotify employees regarding his involvement with the platform.
Spotify also added 21 million subscribers and some 400,000 podcasts in 2020’s third quarter, with this in mind they have clearly shown already how their steps towards the future are working well. Watching Spotify expand and diversify other the coming years is going to be interesting as well as exciting.