On Friday (November 8), Spotify closed above $400 for the first time in a wave of post-election market enthusiasm, valuing the music streaming giant at nearly $80.5 billion. The company’s shares reached an all-time high of $405.88 before closing at $400.68 (up 4.1% for the week).
The Stockholm, Sweden-based company’s shares rose 113% in 2024, surpassing Universal Music Group (UMG) to become the most valuable music company. As investors grew weary of high-growth but barely profitable streaming companies, Spotify conducted two rounds of massive layoffs in 2023 to help reduce costs without sacrificing user growth or revenue. Spotify will show whether it maintains that momentum with the release of its third-quarter earnings on Tuesday (November 12). At least one analyst expressed optimism ahead of the earnings release: Deutsche Bank raised its Spotify price target to $440 from $430 on Wednesday.
U.S. stocks surge this week after election Donald Trump The Federal Reserve decided to cut interest rates by 0.25 percentage points on Tuesday (November 5) and Thursday (November 7). On Friday, the Nasdaq closed at a record high of 19,286.78 points, up 5.7%. The S&P 500 rose 4.7% to close at a record high of 5,995.54 points. China’s Shanghai Composite Index rose 5.5% to 3,452.30. South Korea’s KOSPI composite index rose just 0.7% to 2,561.15. Britain’s FTSE 100 fell 1.3% to 8,072.39 points.
The Billboard Global Music Index, which includes 20 companies, rose 2.4% to a record high of 2,043.02 points, bringing its year-to-date gain to 33.2%. The index had 13 stocks advancing, six stocks declining and one stock unchanged.
The best-performing music stock this week was iHeartMedia, which announced it would restructure most of its maturing debt and plans to save $200 million in 2025 through cost cutting and adoption of technology. The company’s stock price rose 16.7% to $2.44. “Technology is key to improving our operating leverage and is our continued focus,” CEO Bob Pittman said during an earnings call on Thursday. “It allows us to speed up processes, simplify legacy systems, and empower our people to create more, better, faster.” iHeartMedia shares are down 8.6% year to date, but are up 180% since May 24.
LiveOne announced that revenue for the second fiscal quarter ended September 30 increased by 14% to US$32.6 million, paid membership increased by 27% to 645,000, and the share price per share rose by 15.6% to US$0.89. Up 9.1% $9.00.
On the live streaming front, Live Nation shares rose 5.1% to $123.02 after a post-Election Day rally. The concert organizer is currently facing a lawsuit from the U.S. Department of Justice, but new appointments from the Trump administration may lead to a better outcome. The election isn’t the only reason for the stock’s rise: Morgan Stanley raised its price target from $120 based on “a combination of strong underlying consumer demand and strong incentives for artists to tour,” analysts wrote in a note to investors on Tuesday. The dollar rose to $140. Deutsche Bank also raised its price target on Live Nation to $130 from $122.
K-pop stocks surged this week even though HYBE and SM Entertainment both reported sharp declines in profits last quarter, in part due to weak recorded music revenue. HYBE reported a 99% drop in net profit and its stock price rose 6.4%. Likewise, SM Entertainment shares rose 7.2% in the same week that the company announced a 96% drop in quarterly net profit, a 9% drop in revenue, and a 36% drop in recorded music revenue. SM Entertainment’s announcement that it will launch a new girl group in 2025 (the first since Aespa’s debut five years ago) and release a single and album in the first quarter may have investors optimistic.
JYP Entertainment, which has yet to announce its quarterly financial report, soared 12.6%, while YG Entertainment continued to maintain strong momentum, rising 6.3%, reaching 17.6% in the past three weeks. YG was boosted by the success of “APT”, a collaboration between ROSÉ and Bruno Mars. The song is currently in its second week at the top of the Billboard Global 200 and Billboard Global Excl. charts. US rankings.
Tencent Music Entertainment (TME) announced its third-quarter financial results on Tuesday (November 12), and its stock price rose 2.4% to $11.39. Bernstein initiated coverage on TME with a price target of $14. Barclays initiated the company with an “overweight” rating and a $16 price target.
German concert organizer CTS Eventim was the week’s worst performing music stock, falling 10.4% to 87.70 euros ($94.05). The company will release third-quarter results on November 21.
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