Spotify paid out more money to the music industry last year than ever before. While the streaming giant is significantly increasing its profitability, the current “Loud & Clear” report shows a clear shift in the global music market. Despite these operational successes, the paper recently found itself caught in the wake of a weak overall market.
Record payments and new markets
In the calendar year 2025, Spotify paid out a total of eleven billion US dollars in royalties – an increase of ten percent compared to the previous year. This brings the total payouts since the company’s inception to almost $70 billion. The rise of the so-called “musical middle class” is particularly noticeable, as more and more artists are earning significant sums via the platform:
- 13,800 Artists: Over $100,000
- 1,540 artists: Over $1 million
- 80 Artists: Over $10 Million
At the same time, the dominance of English-language titles is losing ground. Last year, songs in 16 different languages made the global top 50. The fastest-growing genres included Brazilian Funk (+36%), K-Pop (+31%) and Latin Trap (+29%), each generating more than $100 million in royalties. Around half of the total distributions went to independent artists and labels.
Strong quarterly figures defy market pressure
Operationally, CEO Daniel Ek’s strategy appears to be working. In the fourth quarter of 2025, the company significantly exceeded analysts’ expectations with earnings per share of EUR 4.43. Sales climbed to 4.5 billion euros. The key to this success was strict cost management and an improved mix of income sources, which increased the operating result to 701 million euros. The gross margin reached a historic high of 33.1 percent.
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Should investors sell immediately? Or is it worth joining? Spotify?
However, this optimism has recently been barely reflected on the stock market. The stock suffered from the weak environment on the Nasdaq, which was weighed down by geopolitical tensions in the Middle East and rising oil prices. With a current price of EUR 442.30, the stock has lost almost ten percent since the beginning of the year. But the fundamental basis remains stable with 751 million monthly active users.
Spotify is increasingly relying on global diversification and cost efficiency to defend its record margin of over 33 percent. For the current financial year, the focus is on scaling the business model with a user base of more than three quarters of a billion people.
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