Streaming service Spotify announced Wednesday
its plan to go public.
The company will begin trading on the New York
Stock Exchange under the ticker name SPOT.
According to the company, shares have traded as
high as $132.50 on private markets, which would
give the company a valuation over $23 billion based
on ordinary shares outstanding as of February 22.
Spotify is the leader in streaming music services
globally, with the company reporting 71 million paying
subscribers and more than 159 million monthly active
listeners (MAUs) as of December 2017. It is available
in 61 countries and territories. Its closest competitor,
The company reported revenue of $2.37 billion in 2015,
$3.6 billion in 2016 and $4.99 billion in 2017, according
to its F1. (This is based on current euro to dollar conversion
value.) It said paid subscribers are growing at a rate of 46
percent year-over-year, while MAUs are increasing at 29
percent year-over-year.
The company posted a loss of $1.5 billion in 2017, $1
billion of which was from a non-recurring expense due
to convertible notes from a transaction with Tencent in
December 2017. It had an operating loss of $461.3 million
last year, and $425.9 million in 2016.
The company faces significant challenges to its business
model, including risk from fluctuating and unpredictable
royalty rates it pays to music labels, publishers, and songwriters.
"We set out to reimagine the music industry and to provide
a better way for both artists and consumers to benefit from
the digital transformation of the music industry," the company
said in its filing. "Spotify was founded on the belief that music
is universal and that streaming is a more robust and seamless
access model that benefits both artists and music fans."
Spotify's initial offering of shares will not be underwritten,
meaning there is no set price set by underwriters which
will inform opening trades on the New York Stock
Exchange. Goldman Sachs, Morgan Stanley and Allen &
Company are advising Spotify on the offering.
Posts
No comments:
Post a Comment