The Product Cycle Adds To The Long Narrative

Research evidence excerpt

The Product Cycle Adds To The Long Narrative

May 21, 2026

$660MM, well ahead of where we had forecasted in our 2SM note. Adoption has scaled in

parallel: management noted that more than 100MM artists are now using Spotify's marketplace

and promotional tools, and the company's artist promotional tools have become the most relied-

upon marketing engine across the music industry — used by everyone from the biggest labels

in the world to DIY independent artists. We continue to view marketplace as an underappreciated

leg of the SPOT margin story by the market.

Ad Stack Update Builds Confidence In 2H Acceleration. Mgmt explicitly reiterated the 2H

accel and DD growth beyond that. Biddable channels now represent more than 1/3 of the ads

business, active advertisers +68% Y/Y in Q1, and the growth is globalizing (EMEA +10% Y/Y

and LatAm +25% Y/Y). Additionally, podcast sponsorships are now SPOT's fastest growing ad

format +100% Y/Y, with a new dynamic creator sponsorships product letting shows monetize up

to 50% more inventory while reducing overall ad load.

New Product Announcements: SPOT used the Investor Day to roll out a notable slate of new

products and features that collectively support the power-law/add-on monetization thesis. The

most novel was Reserved, a new ticketing feature that holds two concert tickets for an artist's

most dedicated Premium fans before tickets go on sale to the general public, thru an exclusive

partnership with LIVE. On the AI side, Save to Spotify launched two weeks ago and lets users

push content from third-party AI agents (Claude Code, Codex) into Spotify as personalized

media, Prompted Playlists were extended from music to podcasts (with 50%+ of users

discovering a new show), Taste Profile gives users direct natural-language control over how