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Investing.com - Bernstein SocGen Group lowered its price target on Spotify (NYSE:SPOT) to $830.00 from $840.00 on Thursday, while maintaining an Outperform rating on the music streaming service. Despite the slight reduction, Bernstein’s target remains well above the current stock price of $665.67 and the average analyst target. According to InvestingPro data, Spotify shares have surged 68.94% over the past year, significantly outperforming the broader market.
The firm expects U.S. price increases for Spotify are inevitable, particularly as new royalty escalators approach. Bernstein anticipates a "somewhat lackluster" fourth-quarter revenue guidance of approximately €4,500 million from the company. Investors should note that Spotify is set to report earnings in just 5 days, on November 4th, which could provide clarity on these projections.
Despite the reduced price target, Bernstein views Spotify favorably as "an AI winner," noting the company has successfully built pricing power within its standard premium tier through features like lossless audio.
The research firm projects that Spotify will launch a consumer-facing "AI superfan tier" in late Q2 2026, which will complement artist-facing AI features already in development.
These initiatives are expected to drive mid-to-high teens top-line growth for Spotify while maintaining favorable gross margins above 33%, according to Bernstein’s analysis.
In other recent news, Spotify has been the subject of various analyst reviews and strategic partnerships. UBS has reiterated its Buy rating on Spotify, maintaining a price target of $850, with expectations that the company’s third-quarter results will align with management’s outlook. Benchmark also upheld its Buy rating with an $800 price target, highlighting Spotify’s new partnership with Netflix to shift some video podcast content from YouTube to Netflix. This collaboration, set to begin in early 2026, will feature popular shows such as The Bill Simmons Podcast and The Rewatchables.
KeyBanc has maintained an Overweight rating on Spotify, with a price target of $830, suggesting that consensus estimates may be underestimating the company’s medium-term growth. The firm anticipates improvements in engagement and gross margin, with monetization actions expected to phase into the model in late 2025 and early 2026. Additionally, OpenAI has introduced a new feature that allows ChatGPT users to interact with services like Spotify directly through the app, enabling functionalities such as playlist creation. These developments reflect Spotify’s ongoing efforts in partnerships and technological integration.
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