To The Moon

Spotify $Spotify Technology S.A.(SPOT)$ is now used by over half a billion people every month, so why hasn't the stock gone anywhere since IPO? I'll show you SPOT's history in 7 charts. 1. Revenue 2. Margins 3. OpEx 4. Net Income and FCF 5. Segment Revenue 6. Segment GM 7. MAUs Let's go!📈👇 1.Spotify's revenue growth has been steady since IPO, but that's not what investors question. Image 2.Margins are the biggest challenge for Spotify and they're limited by content deals (more on this below). Image 3.Operating expenses have been another challenge. Management has grown opex as the company has grown, meaning no operating leverage. Has that changed in the last quarter? Image 4.FCF has long been positive, but net income? Non-existent. Image 5.Here is a look at premium and ad revenue. Ad revenue is growing more quickly than premium, but it's a slow journey to catch up. Image 6.I mentioned margin challenges above and here they are: 1. Music margins are limited because ~70% of revenue is shared with labels. This is the (green) premium margin below. 2. Ad margins (black) have...been terrible. Image 7.The good news is that users love Spotify! Image I think Spotify can beat the market IF: 1. Ad revenue and margins improve. 2. Opex stays ~flat over the next 5 years. https://twitter.com/TravisHoium/status/1717169950488482072