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Spotify (NYSE: SPOT) grows users to 761M with record Q1 2026 profit

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Form Type
6-K

Rhea-AI Filing Summary

Spotify Technology S.A. reported solid Q1 2026 results with revenue of €4.533 billion, up 8% year over year and 14% on a constant currency basis. Gross margin reached 33.0%, a Q1 record, driven mainly by stronger Premium segment economics.

Operating income rose to €715 million, a 15.8% margin and up 40% year over year, helped by lower Social Charges and cost discipline. Net income was €721 million, significantly higher than €225 million a year earlier. Free Cash Flow reached a Q1 record €824 million, lifting last-twelve-month Free Cash Flow to €3.2 billion.

Monthly Active Users grew 12% year over year to 761 million, with Premium Subscribers up 9% to 293 million. The company ended the quarter with €8.8 billion in cash, cash equivalents, restricted cash and short term investments, after repurchasing €306 million of shares and retiring €1.3 billion of exchangeable notes. Q2 2026 guidance calls for 778 million MAUs, 299 million Premium Subscribers, revenue of €4.8 billion, gross margin of 33.1%, and operating income of €630 million.

Positive

  • Record profitability and cash generation: Q1 2026 operating income reached €715 million (15.8% margin, up 40% Y/Y) and Free Cash Flow hit a Q1 record €824 million, with last-twelve-month Free Cash Flow of €3.2 billion supporting a strong cash position.
  • Robust user and subscriber growth: Monthly Active Users grew 12% Y/Y to 761 million and Premium Subscribers rose 9% Y/Y to 293 million, demonstrating continued global scale expansion alongside improving margins.
  • Strengthened balance sheet and capital returns: Cash, cash equivalents, restricted cash and short term investments totaled €8.8 billion, while the company repurchased €306 million of shares and retired €1.3 billion of exchangeable notes in Q1.

Negative

  • None.

Insights

Spotify pairs double-digit user growth with record profitability and strong cash generation.

Spotify delivered Q1 2026 revenue of €4.533 billion, up 8% year over year and 14% on a constant currency basis, while growing Monthly Active Users to 761 million and Premium Subscribers to 293 million. Premium revenue rose 10% to €4.148 billion with roughly flat reported ARPU of €4.76 and mid-single-digit constant-currency ARPU gains.

Profitability improved sharply. Gross margin reached a Q1 record 33.0%, up 133 basis points year over year, mainly from Premium where gross margin was 34.8%. Operating income climbed to €715 million with a 15.8% margin, while operating expenses declined 5% year over year despite higher marketing, cloud and AI spending, aided by Social Charges of €(39) million versus €75 million a year earlier.

Free Cash Flow of €824 million in Q1 and €3.2 billion over the last twelve months strengthened liquidity to €8.8 billion in cash, cash equivalents, restricted cash and short term investments. Management used part of this to repurchase €306 million of shares and retire €1.3 billion of Exchangeable Notes, signaling balance sheet optimization. Q2 2026 guidance targets further MAU and subscriber gains, revenue of €4.8 billion, gross margin of 33.1%, and operating income of €630 million, assuming modest foreign-exchange headwinds and €10 million of Social Charges.

Total Revenue €4.533 billion Q1 2026, up 8% year over year and 14% constant currency
Operating Income €715 million Q1 2026, 15.8% operating margin, up 40% year over year
Net Income €721 million Q1 2026, versus €225 million in Q1 2025
Free Cash Flow €824 million Q1 2026, 54% year-over-year growth and Q1 record
Cash & Investments €8.8 billion Cash, cash equivalents, restricted cash and short term investments at Q1 2026 end
Monthly Active Users 761 million Q1 2026, 12% year-over-year growth
Premium Subscribers 293 million Q1 2026, 9% year-over-year growth
Gross Margin 33.0% Q1 2026, up 133 basis points year over year
Free Cash Flow financial
"Free Cash Flow* reached €824 million in Q1, bringing LTM*** Free Cash Flow to €3.2 billion."
Free cash flow is the amount of money a company has left over after paying all its expenses and investing in its business, like buying equipment or updating facilities. It shows how much cash is available to reward shareholders, pay down debt, or save for future growth. This helps investors understand if a company is financially healthy and able to grow.
constant currency financial
"Revenue was in-line with guidance and grew at an accelerated 14% Y/Y on a constant currency* basis."
Constant currency is a way of measuring financial results that removes the effects of changes in currency exchange rates. It allows for a clearer comparison of a company's performance over time by showing what the numbers would look like if exchange rates had stayed the same. This helps investors understand whether growth comes from actual business improvements or just currency fluctuations.
Social Charges financial
"Social Charges were €49 million below forecast due to share price movement during the quarter."
Exchangeable Notes financial
"In Q1, we repurchased €306 million ($361 million) of shares and retired €1.3 billion ($1.5 billion) of exchangeable notes."
Exchangeable notes are a type of financial asset that can be converted into shares of a different company or entity at a later time, often at a pre-set price or upon certain conditions. They matter to investors because they offer a way to potentially benefit from the growth of another company while initially providing more safety or flexibility than directly owning stocks. Think of them as a convertible ticket that can be exchanged for ownership in another business if certain opportunities arise.
non-IFRS measures financial
"Constant Currency adjusted measures and Free Cash Flow are non-IFRS measures."
Non-IFRS measures are financial figures that companies create on their own to show aspects of their performance, beyond what standard accounting rules require. They can help investors better understand how a company is really doing by highlighting information that might be more relevant or easier to interpret, much like a sports coach emphasizes certain stats to showcase team strengths not captured by official scores.
Operating Margin financial
"Operating Margin 12.1% 15.5% 15.8% -- --"
Operating margin shows how much profit a company makes from its core business activities after paying for costs like wages and materials. It’s useful because it tells you how efficiently a company is running—higher margins mean it keeps more money from each dollar of sales, which can indicate better management or stronger products.
Form 6-K: How Foreign Companies Report to the SEC →
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 6-K
 
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934
 
For the month of April, 2026
 
Commission File Number: 001-38438

Spotify Technology S.A.
(Translation of registrant’s name into English)
 
33 Boulevard Prince Henri
L-1724 Luxembourg
Grand Duchy of Luxembourg
(Address of principal executive office)


Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.
 
Form 20-F ☒ Form 40-F ☐

INFORMATION CONTAINED IN THIS REPORT ON FORM 6-K

Letter to Shareholders

On April 28, 2026, Spotify Technology S.A. released its results for the quarter ended March 31, 2026 by posting its Q1 2026 Update (“Update”) on its website at investors.spotify.com. A copy of the Update is furnished herewith as Exhibit 99.1 to this Report on Form 6-K.

EXHIBIT INDEX

Exhibit No.
  
Description
   
99.1
  
Q1 2026 Update dated April 28, 2026

SIGNATURES
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
 
 
Spotify Technology S.A.
     
Date: April 28, 2026
By:
/s/ Christian Luiga
 
Name:
Christian Luiga
 
Title:
Chief Financial Officer


Exhibit 99.1

 Q1 2026 Update  April 28th, 2026 
 
 Table of Contents  Key Highlights  Financial Summary  MAUs & Subscribers  Product & Platform  Outlook  Financial Statements  Executive Summary  p.03  p.04  p.06  p.13  p.16  p.19  p.22 
 
 Executive Summary  USER & FINANCIAL SUMMARY  Q1 2025  Q4 2025  Q1 2026  Y/Y  Q/Q  USERS (M)  Total Monthly Active Users ("MAUs")  678  751  761  12%  1%  Premium Subscribers  268  290  293  9%  1%  Ad-Supported MAUs  423  476  483  14%  1%  FINANCIALS (€M)  Premium**  3,783  4,020  4,148  10%  3%  Ad-Supported**  407  511  385  -5%  -25%  Total Revenue  4,190  4,531  4,533  8%  0%  Gross Profit  1,326  1,499  1,495  13%  0%  Gross Margin  31.6%  33.1%  33.0%  --  --  Operating Income  509  701  715  40%  2%  Operating Margin  12.1%  15.5%  15.8%  --  --  Net Cash Flows From Operating Activities  539  856  836  55%  -2%  Free Cash Flow*  534  834  824  54%  -1%  * Constant Currency adjusted measures and Free Cash Flow are non-IFRS measures. See "Use of Non-IFRS Measures" and "Reconciliation of IFRS to Non-IFRS Results" for additional information.  ** Effective January 1, 2026, certain revenue-generating activities previously reported within the Ad-Supported segment were transferred to the Premium segment to reflect changes in the financial information presented to the Group’s new Co-Chief Executive Officers, who serve as the joint chief operating decision makers. Prior period amounts have been reclassified to conform to current period presentation. See Appendix for reclassified and recast segment Gross Profit amounts.  *** Last Twelve Months (LTM) represents annual performance covering the preceding 12 months relative to the last day of the quarter.  We are pleased with our performance in Q1, as all of our KPIs met or exceeded guidance. The business added 10 million MAUs vs. guidance for 8 million, while Subscriber net additions of 3 million were in-line. Revenue was in-line with guidance and grew at an accelerated 14% Y/Y on a constant currency* basis. Gross Margin of 33.0% exceeded guidance and expanded 133 bps Y/Y, while Operating Income of €715 million outperformed due to lower Social Charges and Gross Margin strength. Social Charges were  €49 million below forecast due to share price movement during the quarter. As a reminder, we do not incorporate share price movements into our forecast since they are beyond our control. Free Cash Flow* reached €824 million in Q1, bringing LTM*** Free Cash Flow to €3.2 billion.  Overall, we view the business as well positioned to deliver improved growth and margins in 2026 as we reinvest to support our long-term potential. 
 
 * Constant Currency adjusted measures and Free Cash Flow are non-IFRS measures. See "Use of Non-IFRS Measures" and "Reconciliation of IFRS to Non-IFRS Results" for additional information.  Accelerating MAU growth  with continued Subscriber momentum  Advanced AI-powered personalization with the beta launches of Taste Profile and Prompted Playlist in select markets, giving Premium users greater control over their preferences and recommendations  Deepened music insights and context with the beta rollouts of About the Song in select markets and SongDNA globally, offering richer insights into the stories, creators and connections behind the music  Expanded audiobook discovery with the launch of Audiobook Charts in the U.S. and U.K., highlighting trending and popular titles through weekly rankings  Key Highlights  Improving revenue growth  alongside strengthening profitability  Total Revenue of €4.5 billion accelerated to 8% Y/Y or 14% Y/Y on a constant currency* basis  Gross Margin finished at a Q1 record high of 33.0% (up 133 bps Y/Y)  Operating Income finished at a record €715 million (15.8% margin)  Free Cash Flow* finished at a Q1 record high of €824 million  Enhancing user control, enriching  music insights and expanding audiobook discovery  Q1 MAU net adds of 10 million drove total MAUs to 761 million, accelerating to 12% Y/Y growth  Premium Subscribers grew 9% Y/Y to 293 million, reflecting 3 million quarterly net adds 
 
 Results  Q1 2026 Actuals  Guidance  Total Revenue (€B)  In-Line  €4.5  €4.5  Gross Margin  Above  33.0%  32.8%  Operating Income (€M)*  Above  €715  €660  Key Highlights: Actuals vs. Guidance  Users  Results  Q1 2026 Actuals  Guidance  Monthly Active Users (M)  Above  761  759  Premium Subscribers (M)  In-Line  293  293  Financials  * Includes (€39) million of Social Charges which were €49 million below forecast / guidance driven by share price movement during the quarter. As a reminder, we do not incorporate share price movements into our forecast since they are beyond our control. 
 
 FINANCIAL  SUMMARY 
 
 USER, FINANCIAL & LIQUIDITY SUMMARY  Q1 2025  Q2 2025  Q3 2025  Q4 2025 Q1 2026 Y/Y  Y/Y FXN*  USERS (M)  Total Monthly Active Users ("MAUs")  678  696  713  751  761  12%  --  Premium Subscribers  268  276  281  290  293  9%  --  Ad-Supported MAUs  423  433  446  476  483  14%  --  FINANCIALS (€M)  Premium  3,783  3,753  3,835  4,020  4,148  10%  15%  3%  14%  Ad-Supported  407  440  437  511  385  -5%  Total Revenue  4,190  4,193  4,272  4,531  4,533  8%  Gross Profit  1,326  1,320  1,351  1,499  1,495  13%  18%  Gross Margin  31.6%  31.5%  31.6%  33.1%  33.0%  --  --  Total Operating Expenses  817  914  769  798  780  -5%  1%  Operating Income  509  406  582  701  715  40%  46%  Operating Margin  12.1%  9.7%  13.6%  15.5%  15.8%  --  --  FREE CASH FLOW & LIQUIDITY (€M, unless otherwise denoted)  Net Cash Flows From Operating Activities  539  709  829  856  836  55%  --  Free Cash Flow*  534  700  806  834  824  54%  --  Cash & Cash Equivalents, Restricted Cash & Short Term Investments (€B)  8.0  8.4  9.1  9.5  8.8  --  --  Financial Summary  * Free Cash Flow and Constant Currency adjusted measures (FXN) are non-IFRS measures. See “Use of Non-IFRS Measures” and “Reconciliation of IFRS to Non-IFRS Results” for additional information.  ** Effective January 1, 2026, certain revenue-generating activities previously reported within the Ad-Supported segment were transferred to the Premium segment to reflect changes in the financial information presented to the Group’s new Co-Chief Executive Officers, who serve as the joint chief operating decision makers. Prior period amounts have been reclassified to conform to current period presentation. See Appendix for reclassified and recast segment Gross Profit amounts. 
 
 Revenue  Profitability  Free Cash Flow & Liquidity  Gross Margin was 33.0% in Q1, up 133 bps Y/Y reflecting:  Premium gains driven by Revenue growth outpacing music costs net of marketplace programs, audiobooks costs and video podcast costs; and  Ad-Supported decline driven by music costs and Other Costs of Revenue resulting from higher engagement, which more than offset podcast favorability  Operating Income was €715 million in Q1 and reflected the above, along with:  Higher costs driven by marketing, as well as cloud and AI spend (excluding Social Charges)  Operating Expenses included (€39) million in Social Charges  At the end of Q1, our workforce consisted of 7,258 full-time employees globally  Revenue of €4,533 million grew 8% Y/Y in Q1 (or 14% Y/Y constant currency*), reflecting:  Premium Revenue growth of 10% Y/Y (or 15% Y/Y constant currency*), driven by subscriber gains; and  Ad-Supported Revenue decline of 5% Y/Y (or increase of 3% Y/Y constant currency*)  Unfavorable currency movements slowed Total Revenue Y/Y growth by ~600 bps vs. the ~670 bps incorporated into our guidance  Free Cash Flow* was €824 million in Q1. Our liquidity and balance sheet remained strong, with €8.8 billion in cash and cash equivalents, restricted cash and short term investments.  Financial Summary  * Constant Currency adjusted measures and Free Cash Flow are non-IFRS measures. See "Use of Non-IFRS Measures" and "Reconciliation of IFRS to Non-IFRS Results" for additional information.  ** Effective January 1, 2026, certain revenue-generating activities previously reported within the Ad-Supported segment were transferred to the Premium segment to reflect changes in the financial information presented to the Group’s new Co-Chief Executive Officers, who serve as the joint chief operating decision makers. Prior period amounts have been reclassified to conform to current period presentation. 
 
 Revenue  Premium growth driven by ARPU gains  Premium Revenue* grew 10% Y/Y to €4,148 million (or 15% Y/Y constant currency**), reflecting subscriber growth of 9% Y/Y and roughly flat Y/Y Premium Average Revenue per User (ARPU) of €4.76 (or up 5.7% Y/Y constant currency). Excluding the impact of FX, ARPU performance was driven by price increase benefits, partially offset by product/market mix.  Advertising business transformation continues  Ad-Supported Revenue* declined -5% Y/Y (or increased 3% Y/Y constant currency**). On a constant currency basis, growth in music advertising was driven by growth in impressions sold, partially offset by softness in pricing. Podcasting growth was led by sponsorship gains within our Owned & Licensed portfolio. Automated sales channels remained the largest contributors to overall advertising growth.  * Effective January 1, 2026, certain revenue-generating activities previously reported within the Ad-Supported segment were transferred to the Premium segment to reflect changes in the financial information presented to the Group’s new Co-Chief Executive Officers, who serve as the joint chief operating decision makers. Prior period amounts since 2023 have been reclassified to conform to current period presentation. Comparative amounts for 2022 have not been recast. See Appendix for reclassified and recast segment Gross Profit amounts.  ** Constant Currency (FXN) adjusted measures are non-IFRS measures. See "Use of Non-IFRS Measures" and "Reconciliation of IFRS to Non-IFRS Results" for additional information.  **** Auction-Based Revenue includes biddable sales within the Spotify Ad Exchange and Spotify Ads Manager. 
 
 Premium Gross Margin* was 34.8% in Q1, up 129 bps Y/Y. The Y/Y trend was driven by Revenue growth outpacing music costs net of marketplace programs, audiobooks costs and video podcast costs.  Gross Margin  Solid Y/Y improvement driven by Premium segment gains  Gross Margin finished at 33.0% in Q1, up 133 bps Y/Y. The Y/Y trend was driven by improvement in our Premium segment.  Ad-Supported Gross Margin* was 13% in Q1, down 102 bps Y/Y. The Y/Y decline was due to music costs and Other Costs of Revenue resulting from higher engagement, which more than offset podcast favorability.  * Effective January 1, 2026, certain revenue-generating activities previously reported within the Ad-Supported segment were transferred to the Premium segment to reflect changes in the financial information presented to the Group’s new Co-Chief Executive Officers, who serve as the joint chief operating decision makers. Prior period amounts since 2023 have been reclassified to conform to current period presentation. Comparative amounts for 2022 have not been recast. See Appendix for reclassified and recast segment Gross Profit amounts. 
 
 Operating Expenses declined 5% Y/Y in Q1. Absent the effects of Y/Y movements in currency and Social Charges, the 17% Y/Y increase in Operating Expenses was primarily driven by an increase in marketing alongside cloud and AI spend. The Y/Y increase in marketing was largely due to campaign timing.  As a reminder, Social Charges are payroll taxes associated with employee salaries and benefits in select countries where we operate. Since a portion of these taxes is tied to the intrinsic value of share-based compensation awards, movements in our stock price can lead to fluctuations in the taxes we accrue.  Share price movements this quarter resulted in Social Charges coming in €49 million below forecast at (€39) million in current period Operating Expenses. Prior year period Operating Expenses included €75 million in Social Charges.  Operating Expenses  Y/Y trend led by marketing spend  * Last Twelve Months (LTM) represents annual performance covering the preceding 12 months relative to the last day of the quarter. 
 
 Free Cash Flow  Record Q1 performance aids balance sheet strength  Free Cash Flow* was €824 million in Q1, a record high Q1 as a result of higher Net Income adjusted for non-cash items and improving net working capital. Capital expenditures increased €7 million Y/Y to €13 million.  In Q1, trailing 12 month Free Cash Flow expanded to €3.2 billion. On a cumulative basis, we have generated €8.0 billion of Free Cash Flow since the beginning of 2016, supporting our strong balance sheet and €8.8 billion in cash and cash equivalents, restricted cash and short term investments balance.  In Q1, we repurchased €306 million ($361 million) of shares and retired  €1.3 billion ($1.5 billion) of exchangeable notes.  * Free Cash Flow is a non-IFRS measure. See "Use of Non-IFRS Measures" and "Reconciliation of IFRS to Non-IFRS Results" for additional information. Cume represents cumulative performance since the beginning of 2016.  ** Last Twelve Months (LTM) represents annual performance covering the preceding 12 months relative to the last day of the quarter. 
 
 MAUS  & SUBSCRIBERS 
 
 Total MAUs grew 12% Y/Y to 761 million, up from 751 million last quarter and 2 million above our guidance. Quarterly performance reflected:  Broad-based regional growth, with outperformance led by Rest of World and North America  Mobile free tier enhancements driving accelerated user growth  Monthly Active Users (MAUs) 
 
 Our Premium Subscribers grew 9% Y/Y to 293 million, up from 290 million last quarter and in-line with our guidance. Quarterly performance reflected:  Broad-based regional growth, led by Latin America and Europe  Strong global promotional campaign intake  Premium Subscribers 
 
 PRODUCT  & PLATFORM 
 
 Empowering users to curate and control their experience on Spotify  Released Taste Profile in beta to Premium listeners in New Zealand, offering users a clear view into how Spotify interprets their listening habits. Taste Profile enables users to actively refine how Spotify understands their preferences, giving them greater control over what appears on their homepage.  Launched new video controls that let users better tailor their time on Spotify, either by choosing to maintain an audio-first experience or layer in a richer, video-enhanced one. In a world of passive scrolling, Spotify offers a more intentional experience that listeners can actively shape around what they love.  Prompted Playlist in beta expanded to the U.S. and Canada, allowing Premium listeners to describe exactly what they want to hear in their own words.  Prompted Playlist is also expanding to include podcasts, helping listeners discover new shows, go deep on a specific topic or build a curated lineup to match their mood. 
 
 Driving deeper engagement through music insights and audiobook discovery  Unveiled Audiobook Charts in the U.S. and  U.K. to help users discover their next great listen. Similar to our Music and Podcast charts, Audiobook Charts showcase what’s popular and trending on Spotify with weekly rankings of top audiobooks overall and by genre, giving listeners a clear view of what others are enjoying.  SongDNA rolled out to Premium users globally in beta, letting fans explore the writers, producers, collaborators, samples, interpolations and covers behind the music they love. SongDNA is an immersive music experience that lets fans follow connections between tracks and see how artists, eras and genres intersect for a deeper understanding of the music.  Launched About the Song in beta in select markets, enriching the listening experience through short, swipeable cards that highlight novel details about the music to deepen listeners’ understanding of their favorite tracks and new discoveries. 
 
 OUTLOOK 
 
 Outlook for Q2’26  The following forward-looking statements reflect Spotify’s expectations for Q2 2026 as of April 28, 2026 and are subject to substantial uncertainty.  Total MAUs  778 million  Implies the addition of approximately 17 million net new MAUs in the quarter  Total Premium Subscribers  299 million  Implies the addition of approximately 6 million net new subscribers in the quarter  Total Revenue  €4.8 billion  Assumes ~80 bps headwind to growth Y/Y (vs. ~600 bps in Q1) due to foreign exchange rate movements; based on currency rates as of Q1 close (e.g. USD:Euro of 0.8657 as of March 31 2026)  Gross Margin  33.1%  Primarily driven by Y/Y favorability within the Premium segment  Operating Income  €630 million  Incorporates €10 million in Social Charges based on a Q1 close share price of $484.91  , 
 
 Webcast Information  We will host a live question and answer session starting at 8:00 a.m. ET today on investors.spotify.com. Alex Norström and Gustav Söderström, our Co-Chief Executive Officers, and Christian Luiga, our Chief Financial Officer will be on hand to answer questions. Questions can be submitted by going to slido.com and using the code #SpotifyEarningsQ126. Participants also may join using the listen-only conference line by registering through the following site: https://registrations.events/direct/Q4I5705031.  We use investors.spotify.com and newsroom.spotify.com websites as well as other social media listed in the “Resources – Social Media” tab of our Investors website to disclose material company information.  Use of Non-IFRS Measures  To supplement our financial information presented in accordance with IFRS, we use the following non-IFRS financial measures: Revenue excluding foreign exchange effect, Premium revenue excluding foreign exchange effect, Ad-Supported revenue excluding foreign exchange effect, gross profit excluding foreign exchange effect, Operating Income excluding foreign exchange effect, Operating expense excluding foreign exchange effect, and Free Cash Flow. Management believes that Revenue excluding foreign exchange effect, Premium revenue excluding foreign exchange effect, Ad-Supported revenue excluding foreign exchange effect, gross profit excluding foreign exchange effect, and Operating expense excluding foreign exchange effect, are useful to investors because they present measures that facilitate comparison to our historical performance. However, these should be considered in addition to, not as a substitute for or superior to, Revenue, Premium revenue, Ad-Supported revenue, Gross Profit, Operating Income, Operating expense, or other financial measures prepared in accordance with IFRS. Management believes that Free Cash Flow is useful to investors because it presents a measure that approximates the amount of cash generated that is available to repay debt obligations, to make investments, and for certain other activities that exclude certain infrequently occurring and/or non-cash items. However, Free Cash Flow should be considered in addition to, not as a substitute for or superior to, net cash flows (used in)/from operating activities or other financial measures prepared in accordance with IFRS. For more information on these non-IFRS financial measures, please see “Reconciliation of IFRS to Non-IFRS Results” section below.  Forward Looking Statements  This shareholder update contains estimates and forward-looking statements. All statements other than statements of historical fact are forward-looking statements. The words “may,” “might,” “will,” “could,” “would,” “should,” “expect,” “plan,” “anticipate,” “intend,” “seek,” “believe,” “estimate,” “predict,” “potential,” “continue,” “contemplate,” “possible,” and similar words are intended to identify estimates and forward-looking statements. Our estimates and forward-looking statements are mainly based on our current expectations and estimates of future events and trends, which affect or may affect our businesses and operations. Although we believe that these estimates and forward-looking statements are based upon reasonable assumptions, they are subject to numerous risks and uncertainties and are made in light of information currently available to us. Many important factors may adversely affect our results as indicated in forward-looking statements. These factors include, but are not limited to: our ability to attract prospective users, retain existing users, and monetize our products and services; competition for users, their time, and advertisers; risks associated with our international operations and our ability to manage our growth and the scope and complexity of our business; risks associated with our new products or services and our emphasis on long-term user engagement over short-term results; our ability to provide personalized content that our users enjoy; our ability to sustain our revenue growth rate; our ability to convince advertisers of the benefits of our advertising offerings; our ability to forecast, optimize, or sell advertising inventory amid evolving industry trends in digital advertising; our ability to successfully monetize and generate revenues from podcasts, audiobooks, and other non-music content; potential disputes or liabilities associated with content made available on our premium service and ad-supported service (collectively, the “Service”); risks relating to acquisitions, investments, and divestitures; our dependence upon third-party licenses for most of the content we stream; our lack of control over third-party content providers who are concentrated and can unilaterally affect our access to content; our ability to comply with complex license agreements; our ability to accurately estimate royalty payments under our license agreements and relevant statutes; the limitations on our operating flexibility due to financial commitments required under certain of our license agreements; our ability to identify the compositions embodied in sound recordings and audiovisual works and ownership thereof in order to obtain licenses or comply with existing license agreements; assertions by third parties of infringement or other violations by us of their intellectual property rights; our ability to protect our intellectual property; the dependence of streaming on operating systems, online platforms, hardware, networks, regulations, and standards that we do not control; our ability to maintain the integrity of our technology infrastructure and systems or the security of confidential information; undetected errors, misconfigurations, bugs, or vulnerabilities in our products and services; interruptions, delays, or discontinuations in service arising from our systems or systems of third parties; changes in laws or regulations affecting us; risks relating to privacy and data security, content moderation, use of artificial intelligence, and third parties’ intentional misuse of our products and services; our ability to maintain, protect, and enhance our brand; our ability to meet evolving stakeholder expectations relating to environmental, social, and governance matters; payment  acceptance-related risks; our dependence on key personnel and ability to attract, retain, and motivate highly skilled employees; our ability to access additional capital to support strategic objectives; risks relating to  currency exchange rate fluctuations and foreign exchange controls; the impact of economic, social, or political conditions, including slower growth or recession, inflation, changes in interest rates, changes in trade and tax policies, geopolitical conflicts, and related market uncertainty; our ability to accurately estimate user metrics and other estimates; our ability to manage and remediate attempts to manipulate streams and attempts to gain or provide unauthorized access to certain features of our Service; risks related to our indebtedness, including risks related to our Exchangeable Notes; fluctuation of our operating results and fair market value of ordinary shares; tax-related risks; the concentration of voting power among our founders, which limits shareholders’ ability to influence our governance and business; and risks related to our status as a foreign private issuer and a Luxembourg company. A detailed discussion of these and other risks and uncertainties that could cause actual results and events to differ materially from our estimates and forward-looking statements is included in our filings with the U.S. Securities and Exchange Commission (“SEC”), including our Annual Report on Form 20-F filed with the SEC on February 10, 2026, as updated by subsequent reports filed with the SEC. We undertake no obligation to update forward-looking statements to reflect events or circumstances occurring after the date of this shareholder update.  Rounding  Certain monetary amounts, percentages, and other figures included in this update have been subject to rounding adjustments. The sum of individual metrics may not always equal total amounts indicated due to rounding. 
 
 FINANCIAL  STATEMENTS 
 
 Trending Charts  MAUs, Ad-Supported Users, Premium Subscribers & Revenue By Segment  * Last Twelve Months (LTM) represents annual performance covering the preceding 12 months relative to the last day of the quarter.  ** Effective January 1, 2026, certain revenue-generating activities previously reported within the Ad-Supported segment were transferred to the Premium segment to reflect changes in the financial information presented to the Group’s new Co-Chief Executive Officers, who serve as the joint chief operating decision makers. Prior period amounts since 2023 have been reclassified to conform to current period presentation. Comparative amounts for 2022 have not been recast. See Appendix for reclassified and recast segment Gross Profit amounts. 
 
 Trending Charts  Gross Profit by Segment, Gross Margin by Segment & Free Cash Flow*  * Free Cash Flow is a non-IFRS measure. See "Use of Non-IFRS Measures" and "Reconciliation of IFRS to Non-IFRS Results" for additional information. Last Twelve Months (LTM) represents annual performance covering the preceding 12 months relative to the last day of the quarter.  ** Effective January 1, 2026, certain revenue-generating activities previously reported within the Ad-Supported segment were transferred to the Premium segment to reflect changes in the financial information presented to the Group’s new Co-Chief Executive Officers, who serve as the joint chief operating decision makers. Prior period amounts since 2023 have been reclassified to conform to current period presentation. Comparative amounts for 2022 have not been recast. See Appendix for reclassified and recast segment Gross Profit amounts. 
 
 Interim condensed consolidated statement of operations  (Unaudited)  (in € millions, except share and per share data)  Three months ended  March 31, 2026  December 31, 2025  March 31, 2025  Revenue  4,533  4,531  4,190  Cost of revenue  3,038  3,032  2,864  Gross profit  1,495  1,499  1,326  Research and development  331  290  379  Sales and marketing  342  399  314  General and administrative  107  109  124  780  798  817  Operating income  715  701  509  Finance income  248  349  71  Finance costs  (26)  (29)  (252)  Finance income/(costs) - net  222  320  (181)  Income before tax  937  1,021  328  Income tax expense/(benefit)  216  (153)  103  Net income attributable to owners of the parent  721  1,174  225  Earnings per share attributable to owners of the parent  Basic  3.50  5.71  1.10  Diluted  3.45  4.43  1.07  Weighted-average ordinary shares outstanding  Basic  205,716,853  205,771,982  204,467,927  Diluted  209,280,449  212,493,318  210,243,478 
 
 March 31, 2026  December 31, 2025  Assets  Non-current assets  Lease right-of-use assets  227  234  Property and equipment  182  188  Goodwill  1,099  1,083  Intangible assets  41  41  Long term investments  1,194  2,181  Restricted cash and other non-current assets  59  61  Finance lease receivables  71  69  Deferred tax assets  596  662  3,469  4,519  Current assets  Trade and other receivables  683  802  Income tax receivable  94  116  Short term investments  3,491  4,209  Cash and cash equivalents  5,255  5,258  Other current assets  136  111  9,659  10,496  Total assets   13,128  15,015  Equity and liabilities  Equity  Share capital  —  —  Other paid in capital  6,560  6,496  Treasury shares  (1,007)  (701)  Other reserves  2,581  3,366  Accumulated deficit  (124)  (832)  Equity attributable to owners of the parent  8,010  8,329  Non-current liabilities  Lease liabilities  414  433  Accrued expenses and other liabilities  2  2  Provisions  3  3  Deferred tax liabilities  11  163   430  601  Current liabilities  Trade and other payables  1,250  1,194  Income tax payable  150  72  Deferred revenue  750  711  Accrued expenses and other liabilities  2,471  2,589  Exchangeable Notes  —  1,458  Provisions  49  51  Derivative liabilities  18  10  4,688  6,085  Total liabilities  5,118  6,686  Total equity and liabilities   13,128  15,015  Interim condensed consolidated statement of financial position  (Unaudited) (in € millions) 
 
 March 31, 2026  December 31, 2025  March 31, 2025  Operating activities  Net income  721  1,174  225  Adjustments to reconcile net income to net cash flows  Depreciation of property and equipment and lease right-of-use assets  20  20  20  Amortization of intangible assets  6  5  7  Impairment charge on real estate assets  4  —  2  Share-based compensation expense  56  57  42  Finance income  (248)  (349)  (71)  Finance costs  26  29  252  Income tax expense/(benefit)  216  (153)  103  Other  (2)  1  —  Changes in working capital:  Decrease/(increase) in trade receivables and other assets  91  (66)  (4)  (Decrease)/increase in trade and other liabilities  (94)  70  (90)  Increase in deferred revenue  35  20  3  (Decrease)/increase in provisions  (3)  —  12  Interest paid  (8)  (6)  (13)  Interest received  52  58  70  Income tax paid  (36)  (4)  (19)  Net cash flows from operating activities  836  856  539  Investing activities  Business combinations, net of cash acquired  —  (9)  —  Payment of deferred consideration pertaining to business combinations  —  —  (7)  Purchases of property and equipment  (5)  (22)  (6)  Purchases of short term investments  (6,740)  (5,916)  (3,929)  Sales and maturities of short term investments  7,484  5,318  3,630  Change in restricted cash  1  —  1  Other  (8)  —  (3)  Net cash flows from/(used in) investing activities  732  (629)  (314)  Financing activities  Proceeds from exercise of stock options  64  37  204  Repurchases of ordinary shares  (306)  (381)  —  Payments of lease liabilities  (20)  (14)  (22)  Repayment of Exchangeable Notes  (1,304)  —  —  Payments for employee taxes withheld from restricted stock unit releases  (45)  (60)  (56)  Net cash flows (used in)/from financing activities  (1,611)  (418)  126  Net (decrease)/increase in cash and cash equivalents  (43)  (191)  351  Cash and cash equivalents at beginning of the period  5,258  5,456  4,781  Net foreign exchange gains/(losses) on cash and cash equivalents  40  (7)  (113)  Cash and cash equivalents at period end   5,255   5,258  5,019  (Unaudited) (in € millions)  Three months ended  Interim condensed consolidated statement of cash flows 
 
 Diluted earnings per share  Net income attributable to owners of the parent  721  1,174  225  Fair value gains on dilutive Exchangeable Notes  —  (232)  —  Net income used in the computation of diluted earnings per share  721  942  225  Shares used in computation:  Weighted-average ordinary shares outstanding  205,716,853  205,771,982  204,467,927  Exchangeable Notes  —  2,373,333  —  Stock options  2,772,641  3,283,972  4,160,039  Restricted stock units  787,102  1,056,325  1,600,055  Other contingently issuable shares  3,853  7,706  15,457  Diluted weighted-average ordinary shares  209,280,449  212,493,318  210,243,478  Diluted earnings per share attributable to owners of the parent   3.45   4.43  1.07  March 31, 2026  December 31, 2025  March 31, 2025  Basic earnings per share  Net income attributable to owners of the parent  721  1,174  225  Shares used in computation:  Weighted-average ordinary shares outstanding  205,716,853  205,771,982  204,467,927  Basic earnings per share attributable to owners of the parent   3.50   5.71   1.10  (Unaudited)  (in € millions, except share and per share data)  Three months ended  Calculation of basic and diluted earnings per share 
 
 Three months ended  March 31, 2026  March 31, 2025  IFRS Revenue  4,533  4,190  Foreign exchange effect on 2026 revenue using 2025 rates  250  Revenue excluding foreign exchange effect  4,783  IFRS Revenue year-over-year change %  8 %  Revenue excluding foreign exchange effect year-over-year change %  14 %  IFRS Premium revenue  4,148  3,783  Foreign exchange effect on 2026 Premium revenue using 2025 rates  214  Premium revenue excluding foreign exchange effect  4,362  IFRS Premium revenue year-over-year change %  10 %  Premium revenue excluding foreign exchange effect year-over-year change %  15 %  IFRS Ad-Supported revenue  385  407  Foreign exchange effect on 2026 Ad-Supported revenue using 2025 rates  36  Ad-Supported revenue excluding foreign exchange effect  421  IFRS Ad-Supported revenue year-over-year change %  (5)%  Ad-Supported revenue excluding foreign exchange effect year-over-year change %  3 %  Revenue on a constant currency basis  (Unaudited)  (in € millions, except percentages)  Reconciliation of IFRS to non-IFRS results  Gross profit on a constant currency basis  (Unaudited)  (in € millions, except percentages)  Three months ended  March 31, 2026  March 31, 2025  IFRS Revenue  4,533  4,190  IFRS Cost of revenue  3,038  2,864  IFRS Gross profit  1,495  1,326  Foreign exchange effect on 2026 gross profit using 2025 rates  74  Gross profit excluding foreign exchange effect  1,569  IFRS Gross profit year-over-year change %  13 %  Gross profit excluding foreign exchange effect year-over-year change %  18 % 
 
 Operating expense on a constant currency basis  (Unaudited)  (in € millions, except percentages)  Three months  ended  March 31, 2026  March 31, 2025  IFRS Operating expense  780  817  Foreign exchange effect on 2026 operating expense using 2025 rates  44  Operating expense excluding foreign exchange effect  824  IFRS Operating expense year-over-year change %  (5)%  Operating expense excluding foreign exchange effect year-over-year change %  1 %  Three months  ended  March 31, 2026  March 31, 2025  IFRS Research and development expense  331  379  Foreign exchange effect on 2026 expense using 2025 rates  17  Research and development expense excluding foreign exchange effect  348  IFRS Research and development expense year-over-year change %  (13)%  Research and development expense excluding foreign exchange effect year-over-year change %  (8)%  Three months  ended  March 31, 2026  March 31, 2025  IFRS Sales and marketing expense  342  314  Foreign exchange effect on 2026 expense using 2025 rates  23  Sales and marketing expense excluding foreign exchange effect  365  IFRS Sales and marketing expense year-over-year change %  9 %  Sales and marketing expense excluding foreign exchange effect year-over-year change %  16 %  Three months  ended  March 31, 2026  March 31, 2025  IFRS General and administrative expense  107  124  Foreign exchange effect on 2026 expense using 2025 rates  4  General and administrative expense excluding foreign exchange effect  111  IFRS General and administrative expense year-over-year change %  (14)%  General and administrative expense excluding foreign exchange effect year-over-year change %  (10)%  Reconciliation of IFRS to non-IFRS results 
 
 Reconciliation of IFRS to non-IFRS results  Operating income on a constant currency basis  (Unaudited)  (in € millions, except percentages)  Three months ended  March 31, 2026  March 31, 2025  IFRS Operating income  715  509  Foreign exchange effect on 2026 operating income using 2025 rates  30  Operating income excluding foreign exchange effect  745  IFRS Operating income year-over-year change %  40 %  Operating income excluding foreign exchange effect year-over-year change %  46 % 
 
 Three months ended  September 30, 2022  December March 31, June 30, September  31, 2022 2023 2023 30, 2023  December 31, 2023  March 31,  2024  June 30, September December 2024 30, 2024 31, 2024  March 31, June 30, September December  2025 2025 30, 2025 31, 2025  March 31,  2026  Net cash flows from/(used in)  operating activities  40  (70)  59  13  211  397  211  492  715  883  539  709  829  856  836  Capital expenditures  (5)  (5)  (2)  (2)  (1)  (1)  (5)  (2)  (4)  (6)  (6)  (10)  (23)  (22)  (13)  Change in restricted cash  —  2  —  (2)  6  —  1  —  —  —  1  1  —  —  1  Free Cash Flow  35  (73)  57  9  216  396  207  490  711  877  534  700  806  834  824  Last twelve months ended  June 30, September December 2023 30, 2023 31, 2023  March 31,  2024  June 30,  2024  September December March 31, 30, 2024 31, 2024 2025  June 30, September December 2025 30, 2025 31, 2025  March 31,  2026  Net cash flows from operating activities  42  213  680  832  1,311  1,815  2,301  2,629  2,846  2,960  2,933  3,230  Capital expenditures  (14)  (10)  (6)  (9)  (9)  (12)  (17)  (18)  (26)  (45)  (61)  (68)  Change in restricted cash  —  6  4  5  7  1  1  1  2  2  2  2  Free Cash Flow  28  209  678  828  1,309  1,804  2,285  2,612  2,822  2,917  2,874  3,164  Free Cash Flow  (Unaudited) (in € millions)  Reconciliation of IFRS to non-IFRS results  Free Cash Flow  (Unaudited) (in € millions)  Twelve months ended  December 31,  December 31,  December 31,  December 31,  December 31,  December 31,  December 31,  December 31,  December 31,  2017  2018  2019  2020  2021  2022  2023  2024  2025  Net cash flows from operating activities  179  344  573  259  361  46  680  2,301  2,933  Capital expenditures  (36)  (125)  (135)  (78)  (85)  (25)  (6)  (17)  (61)  Change in restricted cash  (34)  (10)  2  2  1  —  4  1  2  Free Cash Flow  109  209  440  183  277  21  678  2,285  2,874  Free Cash Flow  (Unaudited) (in € millions) 
 
 APPENDIX 
 
 Social Charges Sensitivity  Meaningful movements in our stock price can lead to Social Charge variance  Our guidance incorporates the impact of Social Charges, the vast majority of which appear in Operating Expenses. The amount of Social Charges we accrue for and ultimately pay can be volatile, as they are tied to the value of our share price. Since we do not forecast stock price changes in our guidance, meaningful movements in our stock price over the course of a quarter can lead to meaningful changes in Social Charges. As an example, at the Q1 close, our stock price was $484.91. In Q1, a 10% increase or decrease in our stock price compared to the quarter-end price would have an approximate +/- €23M impact on Social Charges. 
 
 Segment Reclassification  * Effective January 1, 2026, certain revenue-generating activities previously reported within the Ad-Supported segment were transferred to the Premium segment to reflect changes in the financial information presented to the Group’s new Co-Chief Executive Officers, who serve as the joint chief operating decision makers. Prior period amounts have been reclassified to conform to current period presentation.  SEGMENT RECLASSIFICATION  Q1 2024  Q2 2024  Q3 2024  Q4 2024  2024  Q1 2025  Q2 2025  Q3 2025  Q4 2025  2025  Q1 2026  REVENUE (€M)  Premium*  3,259  3,365  3,530  3,721  13,875  3,783  3,753  3,835  4,020  15,391  4,148  Y/Y  20%  21%  21%  17%  19%  16%  12%  9%  8%  11%  10%  Ad-Supported*  377  442  458  521  1,798  407  440  437  511  1,795  385  Y/Y  19%  12%  5%  7%  10%  8%  0%  -5%  -2%  0%  -5%  Total Revenue  3,636  3,807  3,988  4,242  15,673  4,190  4,193  4,272  4,531  17,186  4,533  COST OF REVENUE (€M)  Premium Cost of Revenue*  2,274  2,307  2,346  2,425  9,352  2,514  2,509  2,561  2,623  10,207  2,703  Ad-Supported Cost of Revenue*  358  388  402  449  1,597  350  364  360  409  1,483  335  Total Cost of Revenue  2,632  2,695  2,748  2,874  10,949  2,864  2,873  2,921  3,032  11,690  3,038  GROSS PROFIT (€M)  Premium Gross Profit*  985  1,058  1,184  1,296  4,523  1,269  1,244  1,274  1,397  5,184  1,445  Gross Margin (%)  30.2%  31.4%  33.5%  34.8%  32.6%  33.5%  33.1%  33.2%  34.8%  33.7%  34.8%  Ad-Supported Gross Profit*  19  54  56  72  201  57  76  77  102  312  50  Gross Margin (%)  5.0%  12.2%  12.2%  13.8%  11.2%  14.0%  17.3%  17.6%  20.0%  17.4%  13.0%  Total Gross Profit  1,004  1,112  1,240  1,368  4,724  1,326  1,320  1,351  1,499  5,496  1,495  Total Gross Margin (%)  27.6%  29.2%  31.1%  32.2%  30.1%  31.6%  31.5%  31.6%  33.1%  32.0%  33.0% 
 
 

Source: View Original Filing on SEC EDGAR

FAQ

How did Spotify (SPOT) perform financially in Q1 2026?

Spotify delivered strong Q1 2026 results with revenue of €4.533 billion, up 8% year over year and 14% on a constant currency basis. Operating income reached €715 million with a 15.8% margin, and net income rose to €721 million, reflecting significantly improved profitability.

What were Spotify (SPOT) user and subscriber numbers in Q1 2026?

Spotify ended Q1 2026 with 761 million Monthly Active Users, up 12% year over year, and 293 million Premium Subscribers, up 9%. The quarter added 10 million net new MAUs and 3 million net new Premium Subscribers, with growth broad-based across regions.

How did Spotify’s margins and profitability trend in Q1 2026?

Spotify’s gross margin reached a Q1 record 33.0%, expanding 133 basis points year over year, mainly from Premium segment gains. Operating income rose to €715 million, a 15.8% margin, up from 12.1% a year earlier, aided by lower Social Charges and disciplined operating expenses.

What was Spotify (SPOT) Free Cash Flow and cash position in Q1 2026?

Free Cash Flow in Q1 2026 was €824 million, up 54% year over year, pushing last-twelve-month Free Cash Flow to €3.2 billion. Spotify held €8.8 billion in cash, cash equivalents, restricted cash and short term investments, underscoring substantial balance sheet flexibility.

How is Spotify’s advertising and Premium revenue mix evolving?

Premium revenue grew 10% year over year to €4.148 billion, or 15% on a constant currency basis, supported by 9% subscriber growth and stable reported ARPU. Ad-Supported revenue declined 5% reported, but increased 3% on a constant currency basis, with growth led by music impressions and podcast sponsorships.

What guidance did Spotify (SPOT) provide for Q2 2026?

For Q2 2026, Spotify guides to 778 million MAUs, 299 million Premium Subscribers, and revenue of €4.8 billion. It targets a gross margin of 33.1% and operating income of €630 million, assuming modest foreign exchange headwinds and €10 million in Social Charges.

How is Spotify using capital given its higher Free Cash Flow?

With strong Free Cash Flow, Spotify is both reinforcing its balance sheet and returning capital. In Q1 2026 it repurchased €306 million of ordinary shares and retired €1.3 billion of Exchangeable Notes, while maintaining €8.8 billion in cash and short term investments.

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