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Shares of Spotify (SPOT) are up 6% after the audio-streaming giant issued strong guidance for the current fourth quarter of the year.
Despite the strong guidance, the Swedish company issued third-quarter financial results that missed Wall Street targets on the top and bottom lines.
Spotify announced earnings per share (EPS) of $1.46 U.S., which missed the consensus forecast of $1.85 U.S.
Quarterly revenue of $3.99 billion U.S. was less than the $4.02 billion U.S. expected on Wall Street for the July through September period.
Management said Spotify had 252 million paying subscribers at the end of September this year, beating analysts’ estimates of 250.1 million.
Total monthly active users increased to 640 million, surpassing Wall Street targets.
Looking ahead, Spotify said that ongoing cost cuts and strong subscriber growth in the year’s current fourth quarter should drive its operating income to $509.76 million U.S.
In recent months, Spotify has raised prices for its plans in the U.S. and Canada to capitalize on growing demand for the music and podcasts on its platform.
The company also said that it expects to add about eight million premium subscribers in the current quarter, which would take its total to 260 million.
Spotify’s stock has risen 122% so far this year and currently trades at $419.39 U.S. per share.
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