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A Look at SPOT’s Revenue and Earnings Growth in 2019 and Beyond

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Apr. 9 2019, Published 8:51 a.m. ET

Sales estimated to rise 26.7% in 2019

Spotify (SPOT) entered the public market last year and was identified as a disruptor by analysts. The music streaming business is a fast-growing one, and tech giants, including Google’s YouTube (GOOG), Amazon (AMZN) and Apple, have entered the market.

Spotify is expected to benefit from this growth and is likely to grow its sales exponentially over the next few years. Analysts expect Spotify’s revenue to rise 26.7% YoY (year-over-year) in 2019 to $7.47 billion compared to $5.9 billion in 2018. Its sales are further estimated to rise 23.8% to $9.25 billion in 2020.

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Comparatively, its non-generally accepted accounting principles EPS are expected to fall 175% in 2019 to -$1.35 from -$0.49 in 2018. Its EPS are then expected to rise 45% to -$0.74 in 2020.

Analysts expect Spotify’s EPS to rise at a compound annual growth rate of 28% over the next five years.

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Spotify will post positive EBITDA in 2021

Driven by robust revenue and earnings growth, Spotify’s EBITDA is expected to rise from -$224 million in 2019 to -$95.2 million in 2020 and $130 million in 2021.

Similarly, the company’s operating profit could improve from -$280 million in 2019 to -$152 million in 2020 and $22 million in 2021.

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