Sony sells part of stake in Spotify

Sony sells part of stake in Spotify

The stock rose 19% to US$156.80 at 2.07pm in New York from the $132 reference price set by the New York Stock Exchange well before the price discovery process started.

Services such as Apple Music or Amazon Music Unlimited, even though trailing after Spotify in terms of numbers of subscribers, do not have to worry about staying commercially viable.

As a music-streaming service, Spotify has had to overcome plenty of obstacles and resistance from record labels, not to mention opposition from music artists.

Spotify's 35-year-old chief executive and co-founder Daniel Ek, in a blog essay before the stock listing, said his company had ample "room to learn and grow".

Newly public companies have the benefit of their Wall Street bank underwriters doing all they can to make the stock market debut a success.

After reaching a high of $169, shares closed at $149.01 - 13% higher than its reference price on its first day of trading. Sony didn't immediately comment on what pricing it had previously recorded Spotify's stock at on its books.

Spotify isn't selling any shares and there's no lockup period for company insiders or, with one exception, current shareholders.

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Spotify shares were last at $160.32, up 21 per cent.

As of December, Spotify revealed it had more than 71mn paying subscribers alongside 159mn monthly active listeners, driving its revenue that reached just short of $5bn in 2017.

"Spotify's going to have to get used to market volatility and getting dragged down (or pushed up) by other companies in their general space".

Their music-streaming services are additive to their user ecosystems, which leaves Spotify essentially alone in the quest to design models to keep its business profitable.

The digital music giant bypassed many traditional steps in listing as a public company.

After Spotify launched in 2008, the streaming service company went into the next phase in its venture. "At the same time we see limited pricing power as free alternatives will persist, and that is in the here and now".

"Normally, companies don't pursue a direct listing".

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