An IPO with no fanfare. Spotify, the world’s largest music streaming company, made its first appearance on Wall Street on Tuesday, rising 0.42% over the introductory price. No explosion for its beginnings, then, but it’s normal: the Swedish company, which has never been a beneficiary, had chosen a different mode of introduction, based on supply and demand, without price fixed in advance. With a valuation of $ 29 billion – comparable to that of Michelin – we are at the top of the range of analysts.
There was no blow bell or confetti, his boss, Daniel Ek, did not come to be interviewed on Wall Street, thus derogating from the tradition that the petitioners are present on the day of their first listing. This is because Spotify had chosen an atypical procedure called “direct quotation”, simplified and less expensive because without intermediaries. It is also more unpredictable, the price of securities not being fixed in advance.
71 million paying subscribers
Entering Wall Street, Spotify joins other “unicorns” – unlisted technology companies valued beyond the billion dollar – that have made the leap in recent months, such as Snap, Snapchat’s parent company. Like the latter, Spotify has never made any profit.
Spotify expects revenue to increase by 20 to 30%, between 4.9 and 5.3 billion euros in 2018. Never profitable, the Swedish company nevertheless plans to reduce its operating loss between 230 and 330 million euros, against 378 million in 2017 . But its short-term priority is the number of subscribers it hopes to bring this year to at least 92 million, against 71 million at present. Spotify is the industry leader, ahead of Apple and its 36 million subscribers. But some analysts believe that its operational costs, weighed down by the royalties paid to artists, threaten its business model