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As we write the news this morning, Spotify’s share price is sitting at $320.89, giving the company a market cap (valuation) of $60.84bn. That’s an all-time high as far as we’re aware, and means the company has more than doubled in value since the start of 2020, when it was worth $27.95bn.

It’s grown by more than $5bn this week alone, which has led some reports to draw a link with Spotify’s end-of-year Wrapped promotion (which, by the way, went live for artists yesterday). While there’s no doubt that the blizzard of artists and listeners sharing their 2020 stats is giving Spotify a big social-media boost, the real story of the company’s Wall Street growth is more likely to be about podcasts.

At the end of September 2019, 14% of Spotify’s active users – around 34.7 million people – were listening to podcasts on the platform. A year later, at the end of September 2020, 22% were listening, which thanks to Spotify’s user growth meant 70.4 million people. A doubling of the podcast audience on Spotify, and it’s that – plus all the splashy exclusive show deals – that’s delighted the markets.

Spotify’s ecosystem for podcast creation is also a part of this. The company said yesterday that its Anchor app has been used to create 80% of new podcasts on Spotify this year – and that it’s been used to make 70% of the total catalogue of 1.9m shows. So, podcasts may be sending Spotify’s share price soaring, but it’s about the long-tail community as well as about Michelle Obama and Joe Rogan.

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Stuart Dredge

Music Ally's Head of Insight

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