Spotify rode a post-election wave of market enthusiasm to close above $400 for the first time on Friday (Nov. 8), valuing the music-streaming giant at nearly $80.5 billion. Before finishing at $400.68, up 4.1% for the week, the company’s stock reached an all-time high of $405.88.
When investors began to tire of high-growth streaming companies with little to show in profitability, Spotify underwent two major rounds of layoffs in 2023, helping reduce costs without sacrificing subscriber growth or revenue. With third-quarter earnings coming on Tuesday (Nov. 12), Spotify is expected to show it has maintained that momentum.
U.S. stock markets soared this week following the election of Donald Trump on Tuesday (Nov. 5) and the U.S. Federal Reserve’s decision on Thursday (Nov. 7) to lower interest rates by a quarter of a percentage point.
“Technology is the key to increasing our operating leverage and is a constant focus for us,” CEO Bob Pittman said during an earnings call on Thursday. “It allows us to speed up processes, streamline legacy systems and it enables our folks to create more, better and faster.” iHeartMedia shares are down 8.6% year to date but have risen 180% since May 24.
This past week, the company reported a net loss of $41.3 million, significantly worse than the year-ago period's $9 million loss. However, management renegotiated 80% of the company's debt during the third quarter. The maturity dates on $4.1 billion of debt were extended by three years without raising their interest rates. Guidance suggested $200 million of positive free cash flows in 2025, and some of that cash will be used to pay down debt balances.
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