Spotify Stock Struggles Continue — Morgan Stanley, Guggenheim, and Others Remain Bullish Despite Target Price Reductions

Why It Matters

Analyst optimism indicates a potential stock rebound and validates Spotify’s broader strategic shifts, while the hardware venture could generate new, non‑subscription revenue streams.

Key Takeaways

• Spotify shares down ~33% six‑month, trading $465.
• Guggenheim target $600, Morgan Stanley $650, still buy.
• New co‑CEOs preparing earnings, AI‑focused Investor Day.
• Limited‑edition $495 “Eternal Playlist Urn” speaker launched.
• Hardware push may support Super‑Premium subscription growth.

Pulse Analysis

Spotify’s stock trajectory reflects a broader market correction in the music‑streaming sector, yet institutional confidence remains intact. Morgan Stanley trimmed its target to $650 and Guggenheim to $600, both still above the current $465 price, implying a 30‑35% upside. These revisions follow a series of aggressive forecasts that once floated $900‑$1,000 valuations, underscoring a more measured yet optimistic outlook. Analysts cite the company’s robust ad‑supported growth and expanding podcast ecosystem as key catalysts for a potential rebound.

The upcoming earnings release marks the first under co‑CEOs Gustav Söderström and Alex Norström, a leadership duo expected to steer Spotify toward AI‑driven product enhancements. An Investor Day slated for late May will likely showcase AI integrations, from personalized recommendation engines to automated content moderation, positioning the platform to compete with rivals that are heavily investing in machine‑learning capabilities. Investors will scrutinize subscriber growth, especially within the higher‑margin Super‑Premium tier, and assess whether the new executive team can sustain revenue momentum amid tightening advertising budgets.

Beyond software, Spotify’s launch of the $495 “Eternal Playlist Urn” Bluetooth speaker—a limited run of 150 units created with Liquid Death—signals a strategic pivot toward hardware. While the price point is premium, the collaboration leverages Liquid Death’s cultural cachet and hints at a broader push to monetize brand extensions. If the urn speaker proves a successful proof‑of‑concept, it could pave the way for additional devices that reinforce the Super‑Premium offering, diversify revenue, and deepen user engagement beyond streaming alone.