Spotify CEO Daniel EK is set to step down at the end of this year. The next chapter of the Music Streaming Giant will add a “multi-fork summer strategy” that expands the platform to include more podcasts and audiobooks, told Countl-Quarte Realings’s analysts Today (Nov. 4).
That effort will be enhanced and limited by an AI strategy that includes the latest integration with chatgpt at OpenAi. “We’ve been building Spotify for a long time,” said Ek, who will transition to Executive Chairman next year. The CEO duties will be divided between Alex Norström and Gustav Söderstrom.
Spotify added 17 million users between July and September, reaching 713 million users at the end of the third quarter. Quarterly revenue rose 7 years over 7 years to $48 billion, while revenue was down $1 billion from $344 million a year ago.
Users are spending more time on Spotify than ever before as they try out non-musical content, says incoming CO-CEO Norström. “More than 39 million users stream a video podcast on Spotify now – that’s an increase of 54 percent year-on-year,” NorStröm told an analyst today. He also noted that Spotify’s audiobook catalog has more than 500,000 titles in more than 500,000 English-speaking markets.
To double down on its new formats, Spotify last month announced an agreement with Netflix to bring 16 podcasts to the platform by 2026.
One weak spot in the strong earnings report was Spotify’s advertising business. Income supported by 6 years of 6 percent per quarter-challenge CO-CO-COUS coming in as they work to reduce the segment with new partnerships with new players like Yahoo and Amazon. “While these changes will take time, we believe they will yield significant results in the coming years,” Norström said.
It was a particularly busy quarter, during which stoperify released 30 product updates – more than those introduced in all of 2024. “And we haven’t even done a year.
New features include playlist-mixing tools, taste profile controls and in-app messaging (which has already attracted some 25 million users). The broadcaster also unveiled a partnership with chatgpt that allows users to create custom playlists or make content requests by connecting their shiny accounts. Possible prompts could include asking for a “playlist with a zen-like vibe when it comes to your vacations,” says Söderstrom.
Spotify has previously experimented with AI with tools like Spotify DJ, which takes user requests and provides relevant suggestions. But the company plans to take AI deeper into its own ecosystem, making its own recommendation programs and giving creators like musicians, podcasters and writers new tools to engage viewers.
The experience of power consumers has not seen “a lot of saturation,” Söderstrom said. “But we think it will be more in the coming years, and we think we have a chance to be a net beneficiary.”