Spotify posted its first profitable full year in 2025. This year, it almost doubles that, bringing it to $2.21bn. Its model remains freemium: free users must put up with ads, lower sound quality and the need to stay connected to the internet. On the revenue side, subscriptions account for 90% of the $17.1bn, with advertising making up the rest.

Commercial momentum remains strong. Over one year, Spotify added 27 million subscribers, taking the total to 290 million, including 76 million active users, reaching 751 million. Management still expects revenues and margins to accelerate in Q1.

That growth is impressive at this scale, but the question of market saturation will eventually arise. The next challenge will therefore be twofold: move prices upmarket (a real test of 'pricing power') and, above all, open up new growth drivers by seizing technological opportunities.

The platform is not sacrificing margins for user acquisition. Revenue growth has outpaced royalties, notably thanks to more profitable podcasts and well-calibrated price increases - all the more so as they are being matched by rivals that do not have half its market share.

One encouraging point in the release is that price increases have not slowed subscriber acquisition. Switching platforms carries a high "mental cost" - habits, recommendations, personalized playlists tailored to tastes, listening history... On the eve of wider adoption of artificial intelligence, Spotify already offers a strong personalization package, carried by popular formats such as the year-end 'Wrapped' or made-to-measure playlists.

Management is confident about integrating AI to strengthen personalization and speed up product innovation. Admittedly, AI could help competitors close part of the gap, but Spotify retains the advantage of scale. In a market increasingly hunting for AI's knock-on losers, executives must persuade investors that AI will be an opportunity rather than a threat.

Two years ago, Spotify was still a bet. A leader, indeed, but unable to build margins and with no real pricing power. Today, after a drop of around 40% since last summer, the stock looks better valued. Even after the post-results bounce, the share price has still fallen over 20% in 2026. Spotify therefore offers exposure to an undisputed leader, still supported by robust growth and now able to begin returning cash.