2Q26 Preview: Positioned for the Next Act

Research evidence excerpt

2Q26 Preview: Positioned for the Next Act

USA | Internet

Spotify EquityJulyResearch15, 2026

ESTIMATE CHANGE2Q26 Preview: Positioned for the Next Act

We're not expecting a narrative changing print, but prefer to stay positioned for RATING BUY

eventual WMG deal/AI remixing launch. We're in-line on Q2/Q3 revs, see typical PRICE $479.84^

20bps+ Q2 GM beat in upside case, and Q3 Street GM of 33.0% reasonable. PRICE TARGET | % TO PT $600.00 | +25%

We'll be listening for commentary on AI remixing adoption/timeline, but given 52W HIGH-LOW $748.30 - $405.00

investor skepticism on uptake, remixing is ultimately a "show-me" that we think FLOAT (%) | ADV MM (USD) 72.3% | 874.19

plays out positively in the coming months. Reiterate Buy and $600 PT. MARKET CAP $100.4B

TICKER SPOT

SPOT remains one of our top picks. While we're not expecting a major beat/narrative changing ^Prior trading day's closing price unless otherwise noted.

print, we don't want to lose sight of the bigger picture. We understand the near-term bear

case (bull-bear feedback note), but prefer to stay positioned for a WMG remixing deal and new

product launches that could drive upside to numbers. With the cost step-up already absorbed and FY (Dec) CHANGE TO JEFe JEF vs CONS

positioning cleaner of late, we see limited downside and expect the next catalyst cycle to emerge 2025 2026 2025 2026

in the coming months. REV* NA NM NM NM

EBITDA NA -2% NM +2%

On Q2 GM, we model 33.1% (in-line with guide), though a typical ~20bps beat to ~33.3% is a

reasonable upside case. Recall ahead of Q1 we thought SPOT could guide Q2 GM to 33.6%+ given

2025 (€) Q1A Q2A Q3A Q4A FY

full qtr US price increase benefit, suggesting the current guide reflects earmarked investments. As

EBITDA 580.1 506.1 681.2 783.2 2,550.6