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Spotify Rallies 13% on 2030 Growth Targets, Universal Music Deal

Spotify shares surged Thursday after the streaming company unveiled long-term guidance and struck a partnership with Universal Music Group. The deal expands the platform's service offerings.

The platform projects mid-teens compounded annual revenue growth through 2030, with gross margins between 35% and 40%. Spotify has set a goal of reaching 1 billion subscribers and $100 billion in revenue.

Under the Universal agreement, Spotify will introduce a paid premium feature allowing users to create covers and remixes using artist voices from participating performers. The tool represents a new revenue stream for rights holders and marks the first specific AI product Spotify has disclosed following months of discussions with major labels.

Spotify co-CEO Gustav Söderström said the deal enables existing creators to participate in industry innovation for the first time through an established legal framework. Universal's catalog includes artists such as Billie Eilish and Taylor Swift.