Wall Street Slashes Spotify Price Targets After Q1 Miss: Is the Subscriber Story Cracking?

Spotify (NYSE:SPOT) faces sharply divided Wall Street sentiment aft its Q1 2026 earnings, with 4 firms cutting terms targets portion Rosenblatt issued a contrarian upgrade. Spotify banal closed astatine $434.20 connected April 28, capping a 17% one-week decline.

The absorption is striking fixed header numbers bushed expectations. Spotify's EPS of $3.45 topped the $2.95 consensus, and gross grew 8% twelvemonth implicit twelvemonth (YoY) to $4.53 billion.

The catalyst for terms people cuts is softer Q2 2026 guidance and increasing interest astir AI disruption to the subscriber model. Five large firms moved connected Spotify banal successful coordinated fashion, echoing themes from our caller streaming assemblage AI disruption analysis.

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The Analyst's Case

Barclays chopped its SPOT banal terms people to $500 from $600 portion keeping an Overweight rating, informing that the company's "increasing absorption connected incrementalism with respect to its concern exemplary is apt to marque it pugnacious to propulsion backmost against the emerging AI disruption narrative." KeyBanc trimmed to $680 from $745, citing discretionary investments and a catalyst way done the May 21 Investor Day.

Canaccord moved to $720 from $750, noting Spotify added 10M monthly progressive users (MAUs) and 3M nett Premium subscribers. Pivotal Research dropped to $400 from $420, calling the study coagulated but the outlook mixed.

Rosenblatt upgraded Spotify banal to Buy from Neutral astatine a terms people of $500, down from $670. The steadfast argues the post-earnings selloff created worth contempt a flimsy miss connected Premium subscribers and brushed Q2 operating income guidance.