(Hypebot) — Spotify stock fell 8.06% on Wednesday after Spotify reported continued losses and a weaker than expected outlook for the year ahead.
Spotify stock closed Wednesday at $317.25 USD −27.80 (8.06%).
“Looking ahead, we are optimistic about the underlying trends in the business into 2021 and beyond, however, we face increased forecasting uncertainty versus prior years due to the unknown duration of the pandemic and its ongoing effect on user, subscriber, and revenue growth,” Spotify said on the Q4 report that spooked investors yesterday.
But Spotify’s growing losses as outlined in this MBW analysis may be the biggest cause for concern:
“Spotify’s operating loss in the calendar year of 2020 stood at €293m ($335m) – more than four times the op loss the company posted in 2019.”
“Worse still, after additional finance-related costs are taken into account, Spotify’s pre-tax loss in 2020 weighed in at €709m ($810m), no less than five times the equivalent loss seen at the company in the prior year.”
“In fact, that $810m annual loss is the equivalent of Spotify losing $2.2m every day that ticked by in 2020.”