Spotify Technology S.A. (SPOT) offers an audio-streaming subscription service. The company monetizes its service through monthly fees for its premium subscription service and through sales of advertising associated with its free streaming service. In 2023, Spotify offered Premium services to 236 million subscribers, a 15% year-over-year increase. The company also reported a total of over $13.2 billion pounds as well as a net loss of $602 million pounds.
Key Takwaways
- Headquartered in Sweden and legally domiciled in Luxembourg, Spotify is a foreign company and is thus not required to disclose the same information as U.S. firms concerning the share ownership of corporate insiders.
- The top institutional shareholders of Spotify are Daniel G. Ek and Martin Lorentzon.
- For institutional firms, Baillie Gifford & Co., Morgan Stanley (MS), and T. Rowe Price Associates Inc. are the institutions holding the most shares.
Top Individual Insider Shareholders
The following individual shareholders own the most shares of Spotify. Note that the shares noted do not reflect any options or futures contracts giving these individuals the right to future shares. The number of shares used for any proportion is pulled from Spotify's Form 20-F filed with the SEC for the period ending Dec. 31, 2023. The number of total outstanding shares at that date was 197,143,389.
Daniel G. Ek
Daniel Ek owns 30.9 million shares of Spotify, representing 15.6% of total shares outstanding, according to the company's annual report for the period ending Dec. 31, 2023.
Mr. Ek is the co-founder and chief executive officer (CEO) of Spotify. He founded the company in 2006 with his business partner, Martin Lorentzon. Spotify has since grown into a leading music-streaming service. Mr. Ek oversaw the company's initial public offering (IPO) in 2018. Before Spotify, he founded an online marketing firm called Advertigo, which he sold to Sweden-based Tradedoubler AB in 2006. According to Forbes, Mr. Ek has a net worth of $4.1 billion as of February 2024.
Martin Lorentzon
Martin Lorentzon owns 21 million shares of Spotify, representing 10.9% of total shares outstanding, according to the company's annual report for the period ending Dec. 31, 2023.
Mr. Lorentzon is the other co-founder of Spotify. From 2008 to 2016, Mr. Lorentzon served as the company's chair of the board. In 1999, he founded Tradedoubler, the company to which Mr. Ek sold Advertigo in 2006. Mr. Lorentzon also served on the board of directors of Telia Company AB, Sweden's primary telecom operator, between 2013 and 2018. As of February 2024, Forbes estimates his net worth at $5.4 billion.
Top 3 Institutional Shareholders
Institutional investors hold the majority of Spotify's shares at about 55-57% of total shares outstanding. As of February 2024, institutional ownership was 57.84%.
"Insider" refers to people in senior management positions and members of the board of directors, as well as people or entities that own more than 10% of the company's stock. In this context, it has nothing to do with insider trading.
Baillie Gifford & Co.
Baillie Gifford owns 23.7 million shares of Spotify, representing 12% of total shares outstanding, according to Spotify's annual report for the period ending Dec. 31, 2023. As of February 2024, the most recent Investment Stewardship Activities Report was filed for the year ending Dec. 31, 2022. In that report, Billie Gifford reported AUM of $223.4 billion pounds. The company manages a diverse set of mutual funds. The Baillie Gifford International Growth Fund is one of its largest funds. The fund is almost $3 billion in size, Spotify is among the fund's top 10 holdings, comprising about 5.29% of the fund's total assets.
Morgan Stanley
Morgan Stanley owns 9.2 million shares of Spotify, representing approximately 4.6% of total shares outstanding, according to Nasdaq as of Sept. 30, 2023. Morgan Stanley is a multinational investment bank and financial services company with about $1.4 trillion in AUM. The firm offers a diverse range of mutual funds, and complete holdings for its fund offerings are publicly available quarterly 15 calendar days after the quarter ends by calling or emailing customer service.
T. Rowe Price Associates Inc.
T. Rowe Price Associates owns 7.8 million shares of Spotify, representing approximately 4.0% of total shares outstanding, according to Nasdaq records as of Sept. 30, 2023. T. Rowe Price Associates is a subsidiary of T. Rowe Price Group Inc. (TROW), which is a global investment management firm with about $1.45 trillion in AUM. The firm offers both exchange-traded funds (ETFs) and mutual funds. Its Mid-Cap Growth Portfolio (QAMWEX) has total net assets of $553 million as of January 2024 with over 1.3% of the portfolio weight held in SPOT.
How Does Spotify Make Money?
Spotify earns revenue via advertising streams and paid subscription services such as Spotify Premium.
Why Have Some Artists Removed their Content from Spotify?
Some musicians and bands have asked Spotify to remove their content to protest the company's policies, such as low artist royalty pay or the company's commitment to right-wing podcasters like Joe Rogan.
Is Spotify Free?
Spotify has a free version available to users, which is supported by ad revenue. The upgraded premium service has a paid monthly subscription, the cost of which varies by country. This paid version has upgraded features such as ad-free music.
The Bottom Line
The top shareholders of Spotify include co-founders Daniel G. Ek and Martin Lorentzon, with Ek owning 15.6% of total shares and Lorentzon owning 10.9%. Institutional investors like Baillie Gifford & Co., Morgan Stanley, and T. Rowe Price Associates Inc. also hold significant shares, with institutional ownership totaling around 55-57% of total shares outstanding.
