On February 02, Spotify Technology S.A. (SPOT) plunged further after-hours following its Q4 2021 financial results.

The stock while seeing a huge volume of 6.69 million shares, suffered a loss of 5.75% ahead of the earnings release, during regular trading. SPOT had a value of $191.92 per share at the close of the regular trading session. Following the earnings release, the stock went down by a further 10.43% at 2.42 million shares in the after hours. Hence, SPOT was trading at $171.90 apiece in the after-hours on Wednesday.

The digital music service, Spotify Technology S.A. has a market capitalization of $38.23 billion. Its 190.79 million outstanding shares have added 9.80% in the past five days. Moreover, SPOT stock has lost 17.99% year to date while losing 39.51% last year.

SPOT’s Q4 2021

In Q4 2021, the company generated revenue of 2,689 million euros, marking a year-over-year increase of 24%.

Furthermore, SPOT had operating expenses of 719 million euros in Q4 2021, with 12% year over year growth.

The company ended the quarter with cash, cash equivalents, restricted cash, and short-term investments of 3.6 billion euros.

Additionally, MAUs were up 18% YOY, Premium subscribers 16% YOY, and Premium ARPU 3% YOY in Q4 2021.

Future Guidance

For Q1 2022, the company expects total MAUs to be near 418 million and Premium subscribers 183 million.

In addition, SPOT expects total revenue to be approximately 2,60 billion euros in Q1 2022.

Findaway’s Acquisition

On November 11, the company announced its definitive agreement for acquiring Findaway. Findaway is a global leader in digital audiobook distribution.

The acquisition would result in the company’s entry into the growing audiobooks industry. Hence, SPOT will not only scale its audiobook catalog for consumers but also provide new opportunities for publishers, authors, and independent creators.

While the terms of the agreement were not disclosed, the deal was expected to close in Q4 2021.

SPOT’s Share Repurchase Program

On August 20, the company had initiated a share repurchase program of $1.0 billion of its ordinary shares. So far, in 2021 SPOT repurchased 458,234 of its ordinary shares for 89 million euros.

The program is expected to close on April 21, 2026.

Conclusion

On Wednesday, the company released its quarterly earnings along with the outlook for the ongoing quarter. The unimpressive outlook with slow growth disappointed the investors. Therefore, SPOT stock plunged further deep in the after-hours on Wednesday.