Spotify shares soar after Joe Rogan podcast deal
The music streaming platform saw its share price surge on Wednesday after announcing exclusivity deal with comedian Joe Rogan’s popular podcast.
Spotify shares extended gains on Wednesday after the company announced that comedian Joe Rogan’s popular podcast will be available on its platform from 1 September and become exclusive to the music streaming service later this year.
The stock has climbed 15% since announcing the exclusive deal, rallying $24, with the share price trading at $183 per share at time of publication.
The multi-year deal, which will see The Joe Rogan Experience disappear from all other streaming platforms is reportedly valued at $100 million (£82 million).
‘It will remain free, and it will be the exact same show,' Rogan said in a statement. ‘It's just a licensing deal, so Spotify won't have any creative control over the show.’
‘They want me to just continue doing it the way I'm doing it right now,’ he added. ‘I'm excited to have the support of the largest audio platform in the world and I hope you folks are there when we make the switch!’
Spotify shares exceed analysts price targets
Of the 24 analysts offering 12-month price forecasts for Spotify the median target for the stock is $168.52.
But the music streaming platform has seen its shares exceed analysts’ expectations, with the stock trading 8% higher than the median price target.
Rosenblatt analyst Mark Zgutowicz said that the Joe Rogan deal ‘substantially raises Spotify’s global podcast brand’.
Zgutowicz also noted that ‘longer-term halo effects are likely more substantial including leverage with additional high profile deals, and subsequent engagement momentum, inching closer to label (podcast) leverage perhaps sooner than later’.
Spotify sees Q1 revenues soar
Overall, the music streaming platform ‘remains very healthy’ with more than €1.8 billion in liquidity, with the company delivering a strong set of first quarter (Q1) results in April.
In its first three months of trading this year, Spotify has seen its user base swell to 130 million paid subscribers, with 286 million total monthly active users.
That increase in activity helped Q1 revenues rise 22% to €1.85 billion. Of that figure, the majority of revenue came from paid subscriptions, with advertising revenues falling below the company’s guidance due to the Covid-19 crisis.
‘We know that many creators, with touring and live shows cancelled, that the pandemic has brought unthinkable levels of uncertainty into their lives,’ Spotify CEO and founder Daniel Ek said. ‘And like every other company, we are operating in a new reality, and it is, of course, premature to say when things will return to normal, or what the normal will look like.’
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