Spotify grew quickly but struggled to make a profit. Now he’s finally singing a different tune.

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Spotify technology

learned a new song: “Ka-Ching! After years of losses, the audio streamer, which went public at $ 132 a share in 2018, is in the dark. Spotify even surprised analysts, most of whom were forecasting an operating loss. Its shares rose 15% on the week, to $ 291.

Spotify’s problem has always been that it gives most of its revenue back to music labels, whose ownership focused on popular song catalogs gives them leverage. But Spotify added unlabeled content like podcasts and attracted more listeners. In the third quarter, the company reported a profit of two million euros ($ 2.3 million), on revenue of 2.5 billion euros. On a per share basis, Spotify has lost 48 cents, largely due to changes in the value of warrants and exchangeable notes that fluctuate with stocks, which it cannot control.

Spotify user growth rebounded from a weak start to 2021. Monthly active users and premium subscribers both increased 19%, year over year, to 381 million and 172 million, respectively. Gains could accelerate in the fourth quarter; Spotify expects monthly users to climb from 400 million to 407 million.

The most promising sign: Podcasts and better targeting have increased ad revenue by 75% year over year. The gross margin, which had hovered around 25%, reached 26.7% in the quarter, up almost two percentage points last year. Spotify also increased its prices, increasing the margins on premium subscriptions to 29.1%. Result: 75 million euros of operating profit, against a loss of 40 million euros a year ago.

Spotify’s EPS can stay messy, but its core feels solid. It’s music for patient investors.

Write to Avi Salzman at

Last week

Lots of tops

In a record week, the

S&P 500

and Dow industrials hit back-to-back highs earlier in the week. Income was strong, although Robinhood reported that cryptocurrency trading income fell 78%. Stocks fell mid-week, as bond yields flattened, gross domestic product skidded to 2% and



disappointed, but hit new highs on Thursday and Friday. The week, the

Dow Jones Industrial Average

increased 0.4% to 35,819.56; the S&P rose 1.3% to 4,605.38; and the

Nasdaq Composite

rose 2.7% to 15,498.39.

Tesla In, Meta Out

Tesla joined the trillion dollar market cap club after Hertz announced it would buy 100,000 Tesla Model 3s (maybe half of them for Uber drivers). The stock closed on Monday up more than 12% at $ 1,024.86. “Wild $ T1mes,” Tesla CEO Elon Musk tweeted. Tesla joins Apple,


Amazon and Alphabet — with Microsoft bulky Apple for the best dog.


a former club member, saw his shares plummet as ad sales dwindled. CEO Mark Zuckerberg blamed Apple’s privacy policy and a “coordinated attack” on the company and announced a refocus on younger users. And more: He changed his name. Goodbye Facebook, hello Meta.

Revise the infrastructures

Democrats struggled to reach agreement on the ‘soft infrastructure’ bill, squabbling in billionaire tax and paid family leave, only to be greeted with a $ 1.85 trillion compromise plan. White House dollars. President Biden presented the package on Capitol Hill before flying to the G-20 meeting in Rome and the climate summit in Glasgow. Included in the plan: a minimum corporate tax of 15% and surcharges on higher income. Discussions continued.

Talk conical

Federal Reserve Chairman Jerome Powell admitted inflation could persist until 2022 amid forecasts the central bank would agree to cut bond purchases at its meeting next week.

Cold in China

China Evergrande made a second bond installment after restarting projects in southern China. However, Modern Land, a green developer, did not make a payment on a bond issue as the junk funding dried up. The Federal Communications Commission has revoked China Telecom’s license to operate in the United States, citing national security concerns, and China has resisted a pledge to reduce its dependence on coal as it grapples with a energy crisis as winter approaches.

Annals of negotiation

Pay Pal

said he was no longer in talks about a merger with a social media company


PayPal shares rallied… DraftKings dropped $ 22 billion UK bid


after the breakdown of talks… Negotiations for


buy state property

Banca Monte dei Paschi di Siena

oldest continuously operating bank, collapsed… Activist Third Point urged

Royal Dutch Shell

to break up, accusing him of “incoherent” strategies … T. Rowe Price has agreed to buy credit manager Oak Hill Advisors for up to $ 4.2 billion.

Write to Robert Teitelman at

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