The Biz: Spotify’s Mixed Bag Earnings, What The Street Expects From Live Nation & More

Spotify Posts Mixed Earnings Report

Spotify reported strong user growth in its second quarter earnings report, but nevertheless posted a loss, leading to a steep drop in its share price.

The streaming giant said its paid subscriber base hit 276 million in Q2, up 8 million and a 12% year-on-year increase while its monthly user count grew to 696 million, up 11%.

Despite all that, Spotify was broadly a miss against expectations with Q2 revenues of €4.19 billion ($4.86 billion), with expectations of €4.27 billion. That revenue was, still, an increase from €3.81 billion in the second quarter of last year. On the bottom line, the streamer posted an adjusted loss of €0.42 ($0.49) per share, well off the consensus forecast of a per-share profit of €1.97 and a deep drop from earnings of €1.33 in Q2 2024.

The news sent shares tumbling. Spotify opened trading July 29 at $627.36, down $75.57 from its July 28 close of $702.93, an 11% drop. It finished the day closing at $622.19 and was trading at $637.38 midday Thursday.

Spotify pointed to “social charges” — payroll taxes related to share compensation — for its loss, as well as currency fluctuations.

Nevertheless, CEO Daniel Ek said 2025 is looking to be a “standout year” as the company focuses on building life-long users rather than hitting quarterly benchmarks.

The Street Can’t Decide What To Expect From Live Nation

Live Nation is due to report earnings August 7 and even a week out, analysts can’t seem to find a consensus on what to expect.

While shares of the live entertainment giant are still consistently rated buy or overweight — and no major house has changed its position on LYV shares in more than a year and none has downgraded since the height of the pandemic — predictions on what the company will put on its bottom line next week are all over the place.

EPS estimates have a 43-cent spread from a low of $0.81 to $1.24 across nine predictions, with two revised down in the last week. LYV has been a fairly consistent beat since the end of the pandemic, which may be giving analysts pause on revising too hard one way or the other.

There’s a little less disagreement on the top line with predictions falling fairly close to the consensus of $6.82 billion.

Because of the strong revenue growth, any bearish moves on the stock seem to be a reflection of the reality of rising production costs cutting into profitability. A stronger-than-expected economic report this week – which would generally drive up prices on consumer discretionary stocks like LYV – hasn’t had that effect, as shares of Live Nation have been mildly volatile all week.

Orlando Issues Bonds For Stadium Upgrades

The City of Orlando is issuing $420 million in bonds to finance upgrades to Camping World Stadium and for the construction of a new events center.

The tax-exempt bonds are payable from stadium revenues.

Orlando is the latest Florida city to get into the stadium upgrade and construction boom, with renovations underway in Jacksonville for the NFL Jaguars and the Tampa Bay area likely to see a new home for the Rays.