Streaming service handily beats Wall Street reference price
Swedish streaming giant Spotify debuted on Wall Street with a bang, offering a bright spot amid dark times for technology stocks.
The company’s shares surged more than 25 per cent above the Wall Street Stock Exchange’s reference price of $132 (£94) to $165.90 (£118) a share. That translated into a $29.5bn (£21bn) valuation for a company now trading under the ticker symbol SPOT.
Rather than opting for an initial public offering, Spotify engaged in what’s known as a direct offering, which is not underwritten by banks. Founder Daniel Ek noted in a blog post ahead of the offering that existing shareholders have already been able to buy and sell stocks.
Read more
- Spotify has done the right thing by cutting out Wall Street banks
- Spotify expects revenue to grow as it gears up for public listing
- Spotify releases feature that could change how you listen to music
“Normally, companies ring bells”, Mr Ek said. “Normally, companies spend their day doing interviews on the trading floor touting why their stock is a good investment. Normally, companies don’t pursue a direct listing. While I appreciate that this path makes sense for most, Spotify has never been a normal kind of company”.
In the months leading up to the offering, moved to strengthen its market position by inking licensing deals with a number of major music labels. Spotify executives believe a shift to streaming music can help revive the music industry’s flagging fortunes.
World news in pictures
World news in pictures
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1/50 3 April 2018
South African school children pause next to a portrait of the late South African anti-apartheid campaigner Winnie Madikizela-Mandela, wife of African National Congress leader Nelson Mandela, at her house in Soweto. South African President Cyril Ramaphosa paid tribute to Winnie, who died on April 2, saying that Nelson Mandela's former wife was a "voice of defiance" against white-minority rule.
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2/50 2 April 2018
Jewish priests and civilians take part in the Cohanim prayer during the Passover holiday at the Western Wall in the Old City of Jerusalem.
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4/50 31 March 2018
Mourners hold back a relative of Palestinian Hamdan Abu Amshah, who was killed along the Israel border with Gaza, during his funeral in Beit Hanoun town.
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5/50 30 March 2018
Israeli soldiers shot tear gas grenades towards the Palestinian tent city protest commemorating Land Day. The day marks the killing of six Arab Israelis during 1976 demonstrations against Israeli confiscations of Arab land.
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7/50 28 March 2018
French gendarmes escort the coffin of the late Lieutenant Colonel Arnaud Beltrame transported by car during a funeral procession leaving the Pantheon as part of a national tribute in Paris. The French President will lead a national commemoration to hostage-swap policeman Arnaud Beltrame killed in jihadist attack.
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8/50 27 March 2018
Russian President Vladimir Putin visits a memorial made for the victims of a fire in a multi-story shopping center in the Siberian city of Kemerovo. Officials say that the fire escapes were blocked and a PA system was turned off during the fire that killed over 50 people.
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9/50 26 March 2018
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10/50 25 March 2018
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11/50 24 March 2018
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12/50 23 March 2018
Police at the scene of a hostage situation in a supermarket in Trebes. An armed man took hostages in a supermarket in southern France, killing three and injuring about a dozen others, police said. A French minister confirmed the gunman had been shot dead by police.
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14/50 21 March 2018
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15/50 20 March 2018
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16/50 19 March 2018
The Soyuz MS-08 spacecraft is mounted on the launch pad at the Russian-leased Baikonur cosmodrome in Kazakhstan
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17/50 18 March 2018
President Vladimir Putin walks out of a voting booth at a polling station during Russia's presidential election in Moscow.
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18/50 17 March 2018
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19/50 16 March 2018
Russian President Vladimir Putin visits the Almazov National Medical Research Centre in Saint Petersburg.
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20/50 15 March 2018
Vladimir Putin chairs a meeting with members of the Security Council in Moscow.
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21/50 14 March 2018
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22/50 13 March 2018
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23/50 12 March 2018
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24/50 11 March 2018
French President Emmanuel Macron and his wife Brigitte Macron pose for photographs as they visit the Taj Mahal.
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25/50 10 March 2018
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26/50 9 March 2018
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27/50 8 March 2018
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28/50 7 March 2018
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29/50 6 March 2018
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30/50 5 March 2018
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31/50 4 March 2018
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38/50 25 February 2018
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39/50 24 February 2018
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40/50 23 February 2018
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41/50 22 February 2018
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42/50 21 February 2018
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43/50 20 February 2018
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44/50 19 February 2018
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46/50 17 February 2018
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48/50 15 February 2018
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49/50 14 February 2018
The African National Congress’s (ANC) treasurer general Paul Mashatile (left) and parliamentary chief whip Jackson Mthembu address a media briefing, after an emergency ANC caucus meeting on 14 February in Cape Town. South Africa’s parliament will hold a vote of no-confidence in President Jacob Zuma on 15 February, the ruling ANC party said, signalling its determination to eject him from office after days of stalemate
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50/50 13 February 2018
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“Spotify was founded on the belief that music is universal and that streaming is a more robust and seamless access model that benefits both artists and music fans”, the company said in a registration filing.
Spotify’s robust showing contrasted with a tumultuous stretch for technology stocks, which have played a key role in dragging down the markets amid regulatory jitters.
A public outcry over the news that some 50 million Facebook users’ information ended up in the hands of political consulting firm Cambridge Analytica has spurred elected officials in the US and Europe to call for tighter rules.
Technology stocks have tumbled in recent weeks as investors became increasingly wary about the possibility of a government crackdown. Facebook officials have helped stoke those fears, with both CEO Mark Zuckerberg and COO Sheryl Sandberg embracing the possibility of more regulation.
Facebook executive Sheryl Sandberg: social media company would be 'open to regulation'
Amazon has also taken a hit after Donald Trump publicly slammed the online retail giant and repeatedly suggested it should pay more in taxes. The president renewed his assault on the same day as Spotify's offering.
I am right about Amazon costing the United States Post Office massive amounts of money for being their Delivery Boy. Amazon should pay these costs (plus) and not have them bourne by the American Taxpayer. Many billions of dollars. P.O. leaders don’t have a clue (or do they?)!
— Donald J. Trump (@realDonaldTrump) April 3, 2018
But Spotify’s big day was not all smooth. After a Swiss flag was hoisted in front of the New York Stock Exchange, astute observes noted that the company is Swedish.
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