In This Article:
Spotify (SPOT) stock is advancing 10% after the company reported higher-than-expected revenue for the fourth quarter and predicted that its premium user base would come in above analysts' average estimate at the end of the current quarter.
A Look at SPOT's Q4 Results and Its Q1 Guidance
Last quarter, the company's sales advanced 16% versus the same period a year earlier to 4.24 billion euros. Analysts on average had predicted that its top line would come in at 4.16 billion euros.
A person wearing headphones listening to an audio streaming service.
SPOT generated earnings per share of 1.76 euros last quarter, compared with a per-share loss of 0.36 euros in Q4 of 2023.
On the user front, the firm had 263 million premium users at the end of last year, representing a year-over-year increase of 11%. Analysts on average had expected the figure to be 260 million.
As of the end of Q1, Spotify anticipates that its premium user base will climb to 265 million, meaningfully above analysts' mean estimate of 259.27 million.
Also for the current quarter, the audio content provider predicts that it will generate 548 million euros of operating income, well above the average analyst estimate of 460 million euros.
The Recent Price Action of SPOT Stock
In the last month, the stock has risen 27%, while it is up 53% in the last three months.
While we acknowledge the potential of SPOT, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than SPOT but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ ALSO 8 Best Wide Moat Stocks to Buy Now and 30 Most Important AI Stocks According to BlackRock
Disclosure: None. This article is originally published at Insider Monkey.