Spotify Stock Slips to Lowest Price Since Going Public As Market Falls Overall

AP Photo/Richard Drew
A trading post sports the Spotify logo on the floor of the New York Stock Exchange April 3, 2018.

Spotify’s stock price fell to $120 per share during trading on the New York Stock Exchange today, closing at $120.47 -- its lowest since its April 3 direct listing at $165.90 per share.

Spotify’s stock slipped 4.15 percent, or $3.07 a share, over the course of the day from its opening price Dec. 17 of $123.54.

The drop appeared to reflect overall market instability rather than investor concerns about the streaming giant in particular -- the Dow fell more than 500 points during the trading day, according to MarketWatch, its lowest close of the year as a whole, while the Associated Press noted that the S&P also hit an annual low, as U.S. and U.K. stocks both endured a tough day.

But executives and artists at Universal Music Group, which has a rough five percent stake in the streaming service, is watching the stock’s performance closely, sources say.

The other major record companies have already sold their shares at higher prices: Sony Music sold half its Spotify shares in May at an estimated price of $160 per share, netting some $760 million, while Warner Music Group sold 75 percent of its shares a week later for approximately $400 million at around $152 per share, and announced in August it had offloaded the remainder of its shares, netting $504 million in total. Both promised to share that windfall with their artists and labels, too, though while Sony’s proceeds were shared as non-recoupable payments, Warner’s were not.

But UMG has yet to offload its shares, and its execs and artists hope the stock will rebound, sources say. When announcing her new deal with Republic Records last month, Taylor Swift noted that her contract had been negotiated with the stipulation that “any sale of [Universal Music Group’s] Spotify shares result in a distribution of money to their artists, non-recoupable. They have generously agreed to this,” she added, “at what they believe will be much better terms than paid out previously by other major labels.”

Since its debut in April, Spotify’s stock has fluctuated significantly, at one point reaching as high as $198.99 in July and spiking above $190 again at the end of August. But the price has been falling ever since; since the beginning of the month, Spotify has dropped from above $140 per share as the market overall has been dogged by uncertainty. At $22.77 billion, Spotify’s market cap has fallen significantly from its $35.29 billion peak in July, too.


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