Spotify Earnings: Listeners Keep Flocking to Spotify, Which May Spark Monetization Improvement

While Spotify's user monetization was affected mainly by macro headwinds to ad revenue, we were impressed with solid growth in both subscriber and ad-supported user counts. The improvement was especially remarkable since the firm began focusing on operating leaner, which included lower marketing spending. This could make user growth an early indicator of a network effect, but we await more consistency on that front before considering it as an economic moat source.