10q10k10q10k.net
Spotify Technology S.A.

Spotify Technology S.A.SPOT決算レポート

NYSE · 通信サービス · 放送局

Spotify is a Swedish audio streaming and media service provider founded in April 2006 by Daniel Ek and Martin Lorentzon. As of December 2025, it was one of the largest providers of music streaming services, with over 751 million monthly active users comprising 290 million paying subscribers. Spotify is listed on the New York Stock Exchange in the form of American depositary receipts.

What changed in Spotify Technology S.A.'s 20-F — 2023 vs 2024

Top changes in Spotify Technology S.A.'s 2024 20-F

635 paragraphs added · 679 removed · 537 edited across 5 sections

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

202 edited+24 added−59 removed273 unchanged
Item 3. Key Information A. [Reserved] B. Capitalization and Indebtedness. Not applicable. C. Reasons for the Offer and Use of Proceeds. Not applicable. 4 Table of Contents D. Risk Factors An investment in our ordinary shares involves a high degree of risk.
Item 3. Key Information A. [Reserved] B. Capitalization and Indebtedness. 4 Table of Contents Not applicable. C. Reasons for the Offer and Use of Proceeds. Not applicable. D. Risk Factors An investment in our ordinary shares involves a high degree of risk.
Furthermore, an adverse outcome of a dispute may require us to pay significant damages; cease exploiting copyrighted content that we have previously had the ability to exploit; cease using solutions that are alleged to infringe or misappropriate the intellectual property of others; expend additional development resources to redesign our solutions; enter into potentially unfavorable royalty or license agreements in order to obtain the right to use necessary technologies, content, or materials; indemnify our partners and other third parties; and/or take other actions that may have material effects on our business, operating results, and financial condition.
Furthermore, an adverse outcome of a dispute may require us to pay significant damages; cease exploiting copyrighted content that we have previously had the ability to exploit; cease using solutions and technologies that are alleged to infringe or misappropriate the intellectual property of others; expend additional development resources to redesign our solutions or technologies; enter into potentially unfavorable royalty or license agreements in order to obtain the right to use necessary technologies, content, or materials; indemnify our partners and other third parties; and/or take other actions that may have material effects on our business, operating results, and financial condition.
Techniques used to disrupt operations and gain unauthorized access to data and software are constantly evolving, and we may be unable to anticipate or prevent unauthorized access to our technology infrastructure and systems or to confidential information, including but not limited to proprietary business information and data about our users, business partners, and employees, such as payment card or other personal data.
Techniques used to disrupt operations and gain unauthorized access to systems, data and software are constantly evolving, and we may be unable to anticipate or prevent unauthorized access to our technology infrastructure and systems or to confidential information, including but not limited to proprietary business information and data about our users, business partners, and employees, such as payment card or other personal data.
We also make investments in AI and machine learning to improve our advertising, operations, and develop new products or new features for existing products.
We also make investments in AI and machine learning to improve our advertising and operations and develop new products or new features for existing products.
For example, if we fail to obtain licenses to stream sound recordings from major record labels; if the rates we pay for mechanical licenses that are set by the Copyright Royalty Board increase our royalty costs; if we are unable to comply with the requirements to maintain the blanket compulsory mechanical license in the U.S.; if we are unable to obtain blanket licenses for public performance rights on reasonable terms; if our licenses with collecting societies and our direct licenses with music publishers outside of the U.S. do not provide full coverage for all of the musical compositions we make available to our users; for podcasts, audiobooks, and other non-music content, if rights holders or content providers are unwilling to provide content on reasonable terms or do not comply with the terms and conditions of our license agreements as well as our Terms and Conditions of Use, our business, operating results, and financial condition could be materially harmed.
For example, if we fail to obtain licenses to stream sound recordings from major record labels; if the rates we pay for mechanical licenses that are set by the Copyright Royalty Board increase our royalty costs; if we are unable to comply with the requirements to maintain the blanket compulsory mechanical license in the U.S.; if we are unable to obtain blanket licenses for public performance rights on reasonable terms; if our licenses with collecting societies and our direct licenses with music publishers do not provide full coverage for all of the musical compositions we make available to our users; for podcasts, audiobooks, and other non-music content, if rights holders or content providers are unwilling to provide content on reasonable terms or do not comply with the terms and conditions of our license agreements as well as our Terms and Conditions of Use, our business, operating results, and financial condition could be materially harmed.
Additionally, we expect to continue to expend substantial financial and other resources on: • securing top quality content from leading record labels, distributors, aggregators, and other content owners or providers, as well as any rights to works contained in that content; • our technology infrastructure, including development tools, scalability, availability, performance, security, and disaster recovery measures; • research and development, including investments in our research and development team and the development of new features, forms of content, and other products or services; • sales and marketing, including costs related to our field sales organization and advertising globally; • international operations in an effort to maintain and increase our user base, engagement, and sales; and • general administration, including legal and accounting expenses.
Additionally, we expect to continue to expend substantial financial and other resources on: • securing top-quality content from leading record labels, distributors, aggregators, and other content owners or providers, as well as any rights to works contained in that content; • our technology infrastructure, including development tools, scalability, availability, performance, security, and disaster recovery measures; • research and development, including investments in our research and development and the development of new features, forms of content, and other products or services; • sales and marketing, including costs related to our field sales organization and advertising globally; • international operations in an effort to maintain and increase our user base, engagement, and sales; and • general administration, including legal and accounting expenses.
Unfavorable publicity regarding, for example, relationships with record labels, music publishers, artists, podcasters, authors, and other creators or copyright owners, content on our Service, our privacy practices, terms of service, service changes, service quality, litigation or regulatory activity, government surveillance, employee matters, the actions of our advertisers or strategic partners, the actions of our developers whose services are integrated with our products or services, the actions of our users, or the actions of other companies that provide similar services to us, could materially adversely affect our reputation and brand.
Unfavorable publicity regarding, for example, relationships with record labels, music publishers, artists, podcasters, authors, and other creators or copyright owners, content on our Service, our privacy practices, terms of service, service changes, service quality, litigation or regulatory activity, government surveillance, employee matters, the actions of our advertisers or strategic partners, the actions of our developers or suppliers whose services are integrated with our products or services, the actions of our users, or the actions of other companies that provide similar services to us, could materially adversely affect our reputation and brand.
There is no guarantee that we will be able to generate sufficient revenue from podcasts, audiobooks, or other non-music content to offset the costs of creating or acquiring this content. Our expanded audiobook offerings may involve additional risks and challenges, including increased capital requirements, new competitors, and the need to develop new strategic relationships.
There is no guarantee that we will be able to generate sufficient revenue from podcasts, audiobooks, or other non-music content to offset the costs of creating or acquiring this content. Our expanded audiobook or video content offerings may involve additional risks and challenges, including increased capital requirements, new competitors, and the need to develop new strategic relationships.
Failure to compete successfully against our current or future competitors could result in the loss of current or potential advertisers, a reduced share of our advertisers’ overall marketing budget, the loss of existing or potential users, or diminished brand strength, which could adversely affect our pricing and margins, lower our revenue, increase our research and development and marketing expenses, and prevent us from achieving or maintaining profitability.
Failure to compete successfully against our current or future competitors could result in the loss of current or potential advertisers, a reduced share of our advertisers’ overall marketing budget, the loss of existing or potential users, or diminished brand strength, which could adversely affect our pricing and margins, lower our revenue, increase our research and development and marketing expenses, and prevent us from maintaining profitability.
Additionally, our current and future competitors have engaged and will continue to engage in mergers or acquisitions with each other, to combine and leverage their broad audiences, content, and capabilities. Relatedly, we compete for users based on our presence and visibility as compared with other businesses and platforms that deliver audio content through the internet and connected devices.
Additionally, our current and future competitors have engaged and will continue to engage in mergers or acquisitions with each other, to combine and leverage their broad audiences, content, and capabilities. Relatedly, we compete for users based on our presence and visibility as compared with other businesses and platforms that deliver content through the internet and connected devices.
For example, creators or users can record and distribute podcasts using our podcast hosting services, such as Spotify for Podcasters, and can upload cover art and profile images. These may subject us to claims of intellectual property infringement by third parties if such creators or users do not obtain the appropriate authorizations from rights holders.
For example, creators or users can record and distribute podcasts using our podcast hosting services, such as Spotify for Creators, and can upload cover art and profile images. These may subject us to claims of intellectual property infringement by third parties if such creators or users do not obtain the appropriate authorizations from rights holders.
Similarly, the European Union (the “EU”) currently requires equal access to internet content, but as part of the EU’s Digital Single Market initiative and the implementation of the European Electronic Communications Code at the national level, EU Member States may impose network security and disability access obligations on “over-the-top” services such as those provided by us.
The European Union (the “EU”) currently requires equal access to internet content, but as part of the EU’s Digital Single Market initiative and the implementation of the European Electronic Communications Code at the national level, EU Member States may impose network security and disability access obligations on “over-the-top” services such as those provided by us.
Moreover, for minimum guarantee arrangements for which we cannot reliably predict the underlying expense, we will expense the minimum guarantee on a straight-line basis over the term of the arrangement. We also have license agreements that include so-called “most favored nations” provisions, which, if triggered, could cause our royalty payments under those agreements to escalate.
Moreover, for minimum guarantee arrangements for which we cannot reliably predict the underlying expense, we expense the minimum guarantee on a straight-line basis over the term of the arrangement. We also have license agreements that include so-called “most favored nations” provisions, which, if triggered, could cause our royalty payments under those agreements to escalate.
When the fair market value of our ordinary shares increases on a quarter-to-quarter basis, the accrued expense for social costs will increase, and when the fair market value of ordinary shares falls, the accrued expense will become a reduction in social costs expense, all other things being equal, including the number of vested stock options and exercise price remaining constant.
When the fair market value of our ordinary shares increases on a quarter-to-quarter basis, the accrued expense for social costs will increase, and when the fair market value of ordinary shares falls, the accrued expense will become a reduction in social costs expense, all other things being equal, including the number of vested stock options and the average exercise price remaining constant.
In addition, if our billing software fails to work properly and, as a result, we do not automatically charge our Premium Subscribers’ payment method on a timely basis or at all, our business, operating results, and financial condition could be materially adversely affected.
In addition, if our billing software fails to work properly and, as a result, we do not automatically charge our subscribers’ payment method on a timely basis or at all, our business, operating results, and financial condition could be materially adversely affected.
As we collect and utilize personal data about our users as they interact with our products and services, we are subject to new and existing laws and regulations that govern our use of user data. We are likely to be required to expend significant capital to ensure ongoing compliance with these laws and regulations.
As we collect and utilize personal data about our users as they interact with our products and services, we are subject to new and existing laws and regulations that govern our use of user data. We are likely to be required to expend significant effort and capital to ensure ongoing compliance with these laws and regulations.
Since our formation, we have raised capital through the issuance of capital stock on several occasions, and we may continue to do so in the future, which, combined with current or future shareholders’ disposition of ordinary shares, may have resulted in such an ownership change.
Since our formation, we have raised capital through the issuance of capital stock on several occasions, and we may continue to do so in the future, which, combined with our current or future shareholders’ disposition of ordinary shares, may have resulted, or may result, in such an ownership change.
For example, a number of jurisdictions around the world have enacted or are considering changes to the existing framework to calculate income and non-income based taxes, including revenue-based taxes such as digital services taxes and other targeted taxes that apply to our business.
For example, a number of jurisdictions around the world have enacted or are considering changes to the existing framework to calculate income and non-income based taxes, including revenue-based taxes such as digital services taxes and other targeted taxes that may apply to our business.
Such failures could have a material adverse effect on our financial condition and operations. Our business depends on a strong brand, and any failure to maintain, protect, and enhance our brand could harm our business. We have developed a strong brand that we believe has contributed significantly to the success of our business.
Such failures could have a material adverse effect on our financial condition and results of operations. Our business depends on a strong brand, and any failure to maintain, protect, and enhance our brand could harm our business. We have developed a strong brand that we believe has contributed significantly to the success of our business.
The impact of these changes on the overall mobile advertising ecosystem, our business, and the developers, partners, and advertisers in the ecosystem are evolving and their ultimate impact remains uncertain. Additionally, advertisers often rely on third parties to quantify the reach and effectiveness of our ad products.
The impact of these changes on the overall mobile advertising ecosystem, our business, and the developers, partners, and advertisers in the ecosystem are evolving and their ultimate impact remains uncertain. Additionally, advertisers often rely on third parties to quantify the reach and effectiveness of our advertising products.
If we fail to comply with these covenants or to make payments under our indebtedness when due, we would be in default under that indebtedness, which could, in turn, result in that and our other indebtedness becoming immediately payable in full. 27 Table of Contents We may be unable to raise the funds necessary to repurchase the Exchangeable Notes for cash following certain fundamental change as set forth in the Indenture, or to pay any cash amounts due upon exchange, and our future indebtedness may limit our ability to repurchase the Exchangeable Notes or pay cash upon their exchange.
If we fail to comply with these covenants or to make payments under our indebtedness when due, we would be in default under that indebtedness, which could, in turn, result in that and our other indebtedness becoming immediately payable in full. 25 Table of Contents We may be unable to raise the funds necessary to repurchase the Exchangeable Notes for cash following certain fundamental change as set forth in the Indenture, or to pay any cash amounts due upon exchange, and our future indebtedness may limit our ability to repurchase the Exchangeable Notes or pay cash upon their exchange.
We face significant competition for users from companies promoting their own digital audio content online or through application stores, including large, well-funded, and seasoned participants in the digital media market.
We face significant competition for users from companies promoting their own digital content online or through application stores, including large, well-funded, and seasoned participants in the digital media market.
In addition, we may be unsuccessful in integrating our recently acquired businesses or any additional business we may acquire in the future, and we may fail to acquire companies whose market power or technology could be important to the future success of our business.
In addition, we may be unsuccessful in integrating our acquired businesses or any additional business we may acquire in the future, and we may fail to acquire companies whose market power or technology could be important to the future success of our business.
Accordingly, our ability to achieve and sustain profitability and operating leverage on our Service in part depends on our ability to increase our revenue through increased subscription and advertising sales on terms that maintain an adequate gross margin.
Accordingly, our ability to sustain profitability and operating leverage on our Service in part depends on our ability to increase our revenue through increased subscription and advertising sales on terms that maintain an adequate gross margin.
If we fail to grow our user base, the amount of content streamed, and the listening time that our users spend on our Service, we may be unable to grow our advertising revenue.
If we fail to grow our user base, the amount of content streamed, and the time that our users spend on our Service, we may be unable to grow our advertising revenue.
We may introduce new products, services, features, content, or terms of service that our users, creators, advertisers, or partners do not like, which may negatively affect our brand.
We may introduce new products, services, features, content, or terms of service that our users, creators, licensors, advertisers, or partners do not like, which may negatively affect our brand.
Any actual or perceived breach of security or disruptive attack in relation to our systems or a third party’s systems could expose us to actions by governmental entities (in particular given regulators' increased focus on companies' cybersecurity vulnerabilities and risks), data protection authorities, consumers, or others that could result in enforcement, litigation (including class actions), and financial losses, and the public perception of our security measures could be diminished and our reputation harmed, all of which would negatively affect our ability to attract and retain users, which in turn would harm our efforts to attract and retain advertisers, content providers, and other business partners.
Any actual or perceived breach of security or disruptive attack in relation to our or a third party’s systems could expose us to actions by governmental entities (in particular given regulators’ increased focus on companies’ cybersecurity vulnerabilities and risks), data protection authorities, consumers, or others that could result in enforcement, litigation (including class actions), and financial losses, and the public perception of our security measures could be diminished and our reputation 17 Table of Contents harmed, all of which would negatively affect our ability to attract and retain users, which in turn would harm our efforts to attract and retain advertisers, content providers, and other business partners.
Moreover, if we suffer a security breach affecting payment card information, in addition to being in breach of our payment processing agreements, we could be subjected to fines, penalties, and assessments arising out of state and federal regulatory enforcement, liability to consumers, and we may lose our ability to accept card payments for our services on a go-forward basis.
Moreover, if we suffer a security breach affecting payment card information, in addition to being in breach of our payment processing agreements, we could be subjected to fines, penalties, and assessments arising out of state, federal, or other regulatory enforcement, liability to consumers, and we may lose our ability to accept card payments for our services on a go-forward basis.
We face the risk of significant losses from this type of fraudulent activity or financial crime. If we fail to adequately control fraudulent credit card transactions, we may face civil liability, diminished public perception of our security measures, and significantly higher credit card-related costs, each of which could adversely affect our business, reputation, operating results, and financial condition.
We face the risk of significant losses from this type of fraudulent activity. If we fail to adequately control fraudulent credit card transactions, we may face civil liability, diminished public perception of our security measures, and significantly higher credit card-related costs, each of which could adversely affect our business, reputation, operating results, and financial condition.
We cannot assure you that the systems and processes that we have designed (or that third parties have designed) to protect our data and our users’ data, to prevent data loss, to disable undesirable accounts and activities on our platform, and to prevent or detect security breaches, will provide absolute security, and we may incur significant costs in protecting against or remediating cyberattacks.
We cannot assure you that the systems and processes that we have designed (or that third parties have designed) to protect our data and our users’ data, to prevent data loss, to disable undesirable accounts and activities on our platform, and to prevent or detect operational disruption and security breaches, will provide absolute security, and we may incur significant costs in protecting against or remediating cyberattacks.
If we are unable to maintain the growth of our user base, we may be required to expend greater resources than we currently spend on advertising, marketing, and other brand-building efforts to preserve and enhance consumer awareness of our brand, which would adversely affect our operating results and may not be effective.
If we are unable to maintain the growth of our user base, we may be required to expend greater resources than we currently spend on advertising, marketing, and other brand-building efforts to preserve and enhance consumer awareness of and sentiment about our brand, which would adversely affect our operating results and may not be effective.
There can be no assurances that our commitments will be achieved in the manner we currently intend or at all, and any failure (or perceived failure) to advance or meet such commitments may adversely impact our relationship with certain stakeholders. We have also shared publicly our corporate ESG initiatives.
There can be no assurances that our commitments will be achieved in the manner we currently intend or at all, and any failure (or perceived failure) to advance or meet such commitments may adversely impact our relationship with certain stakeholders. We have also shared publicly many of our corporate ESG initiatives.
In addition, some of these competitors, including Apple, Alphabet, and Amazon, have developed, and are continuing to develop, devices for which their music and/or podcast streaming service is preloaded and/or able to be used out-of-the-box without the need to log in, creating a visibility and access advantage.
In addition, some of these competitors, including Apple, Alphabet, and Amazon, have developed, and are continuing to develop, devices for which their streaming service is preloaded and/or able to be used out-of-the-box without the need to log in, creating a visibility and access advantage.
Based on the trading price of our ordinary shares and the composition of our income, assets and operations, we do not believe that we were a PFIC for U.S. federal income tax purposes for the taxable year ending on December 31, 2023, nor that we will be a PFIC in the foreseeable future.
Based on the trading price of our ordinary shares and the composition of our income, assets and operations, we do not believe that we were a PFIC for U.S. federal income tax purposes for the taxable year ending on December 31, 2024, nor that we will be a PFIC in the foreseeable future.
We are also subject to payment card network operating rules and federal laws governing electronic funds transfers, including but not limited to the Payment Card Industry Data Security Standards, which could change or be reinterpreted to make it more difficult for us to comply.
We are also subject to payment card network operating rules and applicable laws governing electronic funds transfers, including, but not limited to, the Payment Card Industry Data Security Standards, which could change or be reinterpreted to make it more difficult for us to comply.
Our royalty payment scheme is complex, and it is difficult to estimate the amount payable under our license agreements or relevant statutes. Under our license agreements and relevant statutes, we must pay all required royalties to record labels, music publishers, and other copyright owners in order to stream content.
Our royalty payment system is complex, and it is difficult to estimate the amount payable under our license agreements or relevant statutes. Under our license agreements and relevant statutes, we must pay all required royalties to record labels, music publishers, and other copyright owners in order to stream content.
Cyberattacks and incidents are expected to accelerate in both frequency and impact as threat actors are becoming increasingly sophisticated in using techniques that circumvent security controls (for example, by leveraging artificial intelligence), evade detection, and even remove forensic evidence, which means that we may be unable to detect, investigate, contain, or recover from future attacks or incidents in a timely or effective manner.
Cyberattacks and incidents are expected to accelerate in both frequency and impact as threat actors are becoming increasingly sophisticated in using techniques that circumvent security controls (for example, by leveraging AI), evade detection, and even remove forensic evidence, which means that we may be unable to detect, investigate, contain, or recover from future attacks or incidents in a timely or effective manner.
Upon expiration or termination of any of our agreements with third parties, we may not be able to replace the services provided to us in a timely manner or on terms and conditions, including service levels and cost, that are favorable to us, and a transition from one third party to another could subject us to operational delays and inefficiencies until the transition is complete.
Upon expiration or termination of any of our agreements with third parties, we may not be able to replace the services provided to us in a timely manner or on terms and conditions, including service 18 Table of Contents levels and cost, that are favorable to us, and a transition from one third party to another could subject us to operational delays and inefficiencies until the transition is complete.
As of December 31, 2023, we had $1,500 million principal amount of indebtedness as a result of the 0% Exchangeable Senior Notes due 2026 (“Exchangeable Notes”) offering. We may also incur additional indebtedness to meet future financing needs.
As of December 31, 2024, we had $1,500 million principal amount of indebtedness as a result of the 0% Exchangeable Senior Notes due 2026 (“Exchangeable Notes”) offering. We may also incur additional indebtedness to meet future financing needs.
If we fail to successfully detect, remove, and address artificial streams and associated user accounts, it may result in the manipulation of our data, including the 26 Table of Contents key performance indicators, which underlie, among other things, our contractual obligations with rights holders and advertisers (which could expose us to the risk of litigation), as well as harm our relationships with rights holders and advertisers.
If we fail to successfully detect, remove, and address artificial streams and associated user accounts, it may result in the manipulation of our data, including the key performance indicators, which underlie, among other things, our contractual obligations with rights holders and advertisers (which could expose us to the risk of litigation), as well as harm our relationships with rights holders and advertisers.
Further, growth in our user base increases the size and scope of user pools targeted by advertisers, which improves our ability to deliver relevant advertising to those users in a manner that maximizes our advertising customers’ return on investment and that ultimately allows us to better demonstrate the effectiveness of our advertising solutions and justifies a pricing structure that is advantageous for us.
Further, growth in our user base increases the size and scope of user pools targeted by advertisers, which improves our ability to deliver relevant advertising to those users in a manner that achieves our advertising customers’ return on investment goals and that ultimately allows us to better demonstrate the effectiveness of our advertising solutions and justifies a pricing structure that is advantageous for us.
As we introduce new products or services or as our products or services evolve, we may become subject to additional competition.
As we introduce new products, services, or technologies or as our products, services, or technologies evolve, we may become subject to additional competition.
If we are unable to maintain our chargeback rate or refund rates at acceptable levels, credit card and 24 Table of Contents debit card companies may increase our transaction fees or terminate their relationships with us. The termination of our ability to process payments on any major credit or debit card would significantly impair our ability to operate our business.
If we are unable to maintain our chargeback rate or refund rates at acceptable levels, credit card and debit card companies may increase our transaction fees or terminate their relationships with us. The termination of our ability to process payments on any major credit or debit card would significantly impair our ability to operate our business.
A United States shareholder of a controlled foreign corporation may be required to report annually and include in its U.S. taxable income its pro rata share of “Subpart F income,” “global intangible low-taxed income,” and 30 Table of Contents investments in U.S. property by controlled foreign corporations, regardless of whether we make any distributions.
A United States shareholder of a controlled foreign corporation may be required to report annually and include in its U.S. taxable income its pro rata share of “Subpart F income,” “global intangible low-taxed income,” and investments in U.S. property by controlled foreign corporations, regardless of whether we make any distributions.
Such partnerships may divert management focus and resources from 13 Table of Contents other aspects of our business, it may take longer than expected for them to produce the expected benefits, they may subject us to additional and unknown licensing or regulatory requirements across different jurisdictions, and they on occasion fail to produce all of the expected benefits.
Such partnerships may divert management focus and resources from other aspects of our business, it may take longer than expected for them to produce the expected benefits, they may subject us to additional and unknown licensing or regulatory requirements across different jurisdictions, and they on occasion fail to produce all of the expected benefits.
We cannot guarantee that these parties will always choose to license to us or license to us on terms that are acceptable to us. 14 Table of Contents The music industry has a high level of concentration, which means that one or a small number of entities may, on their own, take actions that adversely affect our business.
We cannot guarantee that these parties will always choose to license to us or license to us on terms that are acceptable to us. The music industry has a high level of concentration, which means that one or a small number of entities may, on their own, take actions that adversely affect our business.
These third-party measurement services may not reflect our true audience or the performance of our ad products, and their underlying methodologies are subject to change at any time.
These third-party measurement services may not reflect our true audience or the performance of our advertising products, and their underlying methodologies are subject to change at any time.
In addition, actions brought in a Luxembourg court against us, the members of our board of directors, or our officers to enforce liabilities based on U.S. federal securities laws may be subject to certain restrictions. In particular, Luxembourg courts generally do not 33 Table of Contents award punitive damages.
In addition, actions brought in a Luxembourg court against us, the members of our board of directors, or our officers to enforce liabilities based on U.S. federal securities laws may be subject to certain restrictions. In particular, Luxembourg courts generally do not award punitive damages.
In addition, publishers’ fractional ownership of shares of musical compositions may enhance their leverage, as the loss of rights to a major publisher catalog would force us to take down a significant portion of popular repertoire in the applicable territory or territories, which would significantly disadvantage us in such territory or territories.
In 12 Table of Contents addition, publishers’ fractional ownership of shares of musical compositions may enhance their leverage, as the loss of rights to a major publisher catalog would force us to take down a significant portion of popular repertoire in the applicable territory or territories, which would significantly disadvantage us in such territory or territories.
If the information provided to us does not comprehensively or accurately identify the ownership of musical compositions, or if we are unable to determine which musical compositions correspond to specific sound recordings, it may be difficult or impossible to identify the appropriate rights holders from whom 16 Table of Contents to obtain licenses or to whom to pay royalties.
If the information provided to us does not comprehensively or accurately identify the ownership of musical compositions, or if we are unable to determine which musical compositions correspond to specific sound recordings, it may be difficult or impossible to identify the appropriate rights holders from whom to obtain licenses or to whom to pay royalties.
Copyright Royalty Board. That limitation of liability is contingent upon following various procedural steps outlined in the MMA and there is a risk that we can be found to not have properly followed those steps (which could expose us to the risk of increased financial liability in litigations).
Copyright Royalty Board. That limitation of liability is contingent upon following various 14 Table of Contents procedural steps outlined in the MMA and there is a risk that we can be found to not have properly followed those steps (which could expose us to the risk of increased financial liability in litigations).
These competitive risks are heightened because some of our competitors have more extensive hardware, software, and service offerings, longer histories, larger user bases, increased brand recognition, more experience in the markets in which we compete, and greater overall resources than we do.
These competitive risks are heightened because some of our competitors have more extensive hardware, software, and service offerings, longer histories, larger user bases, increased brand recognition, 5 Table of Contents more experience in the markets in which we compete, and greater overall resources than we do.
In addition to statutory enforcement, a data breach has in the past and could in the future lead to compensation claims by affected individuals (including consumer advocacy groups). It could also lead to negative publicity and a potential loss of business as a result of customers losing trust in us.
In addition to statutory enforcement, a data breach has in the past and could in the future lead to compensation claims by affected individuals 20 Table of Contents (including consumer advocacy groups). It could also lead to negative publicity and a potential loss of business as a result of customers losing trust in us.
Failure to comply with these reporting obligations may subject a United States shareholder to significant monetary penalties and may prevent the statute of limitations with respect to such shareholder’s U.S. federal income tax return for the year for which reporting was due from starting.
Failure to comply with these reporting obligations may subject a United States shareholder to significant monetary penalties and may 28 Table of Contents prevent the statute of limitations with respect to such shareholder’s U.S. federal income tax return for the year for which reporting was due from starting.
These investments may not result in increased revenue or growth in our business. If we fail to continue to grow our revenue and overall business, our business, operating results, and financial condition would be harmed. Failure to convince advertisers of the benefits of our advertising offerings could harm our business, operating results, and financial condition.
These investments may not result in increased revenue or growth in our business. If we fail to continue to grow our revenue and overall business, our business, operating results, and financial condition would be harmed. 8 Table of Contents Failure to convince advertisers of the benefits of our advertising offerings could harm our business, operating results, and financial condition.
Our ability to attract and retain advertisers, and to maintain and increase advertising revenue, depends on a number of factors, including: • increasing the number of hours our users spend listening to audio or otherwise engaging with content on our Service; • increasing the number of Ad-Supported Users and the number of our users listening to podcasts; • user demographics and engagement patterns that make us more or less attractive to advertisers; • providing a content portfolio that sustains or increases the value of our advertisements; 10 Table of Contents • keeping pace with changes in technology and our competitors; • competing effectively for advertising dollars with other online and mobile marketing and media companies; • maintaining and growing our relationships with marketers, agencies, and other demand sources who purchase advertising inventory from us; • maintaining and growing our relationships with podcast publishers and other creators who provide us with sources of advertising inventory that we can monetize; • impact from the macroeconomic environment on advertisers; • implementing and maintaining an effective infrastructure for campaign and order management; • convincing advertisers of the value of innovations to our current advertising offerings; • managing adverse legal developments relating to advertising, including changes mandated or prompted by legislation, regulation, executive actions, or litigation regarding the collection, use, and sharing of personal data for advertising-related purposes; and • continuing to develop and diversify our advertising platform and offerings, which currently include delivery of advertising products through multiple delivery channels, including traditional computers, mobile, and other connected devices, and multiple content types, including podcasts.
Our ability to attract and retain advertisers, and to maintain and increase advertising revenue, depends on a number of factors, including: • increasing the number of Ad-Supported Users and the level of our users’ engagement with content on our Service; • user demographics and engagement patterns that make us more or less attractive to advertisers; • providing a content portfolio that sustains or increases the value of our advertisements; • keeping pace with changes in technology and our competitors; • competing effectively for advertising dollars with other online and mobile marketing and media companies; • maintaining and growing our relationships with marketers, agencies, and other demand sources who purchase advertising inventory from us; • maintaining and growing our relationships with podcast publishers and other creators who provide us with sources of advertising inventory that we can monetize; • impact from the macroeconomic environment on advertisers; • implementing and maintaining an effective infrastructure for campaign and order management; • managing adverse legal developments relating to advertising, including changes mandated or prompted by legislation, regulation, executive actions, or litigation regarding the collection, use, and sharing of personal data for advertising-related purposes; • continuing to develop and diversify our advertising platform and offerings, which currently include delivery of advertising products through multiple delivery channels, including traditional computers, mobile, and other connected devices, and multiple content types, including podcasts; and • convincing advertisers of the value of innovations to our current advertising offerings.
Although there is doubt as to whether U.S. courts would enforce this indemnification provision in an action brought in the United States under U.S. federal or state securities laws, this provision could make it more difficult to obtain judgments outside Luxembourg or from non-Luxembourg jurisdictions that would apply Luxembourg law against our assets in Luxembourg.
Although there is doubt as to whether U.S. courts would enforce this indemnification provision in an action brought in the United States under U.S. federal or 31 Table of Contents state securities laws, this provision could make it more difficult to obtain judgments outside Luxembourg or from non-Luxembourg jurisdictions that would apply Luxembourg law against our assets in Luxembourg.
The websites and applications of our competitors may rank higher than our website and our Spotify application in search engines or application stores, and/or our application may be difficult to locate in device application stores, which could draw potential users away from our Service and toward those of our 7 Table of Contents competitors.
The websites and applications of our competitors may rank higher than our website and our Spotify application in search engines or application stores, and/or our application may be difficult to locate in device application stores, which could draw potential users away from our Service and toward those of our competitors.
Many of the types of changes described above, if and when agreed and enacted by various countries in which we do business, may increase our taxes in these countries. Changes in profitability in the jurisdictions in which we operate could have a substantial impact on our tax obligations.
Many of the types of changes described above, if and when agreed and enacted by various countries in which we do business, may increase our tax liability. Changes in profitability in the jurisdictions in which we operate could have a substantial impact on our tax obligations.
For example, prominent, well-funded competitors like Apple, Alphabet, and Amazon have a competitive advantage because they can leverage the substantially broader product offerings in their ecosystem to gain subscribers through bundled offers and to monetize users.
For example, prominent, well-funded competitors like Apple, Alphabet, and Amazon have a competitive advantage because they can leverage the substantially broader product offerings in their ecosystem to gain subscribers and to monetize users.
As consumer 6 Table of Contents tastes and preferences change on the internet and with mobile and other connected products, including cars, in-home, and wearable devices, we will need to enhance and improve our existing Service, introduce new services and features, and maintain our competitive position with additional technological advances and an adaptable platform.
As consumer tastes and preferences change on the internet and with mobile and other connected products, including cars, in-home, and wearable devices, we will need to enhance and improve our existing Service, introduce new services and features, and maintain our competitive position with additional technological advances and an adaptable platform.
Increased attention to climate change and other environmental, social, and governance (“ESG”) issues, as well as societal expectations regarding voluntary ESG initiatives and disclosures, may result in increased costs (including but not limited to costs related to compliance, stakeholder engagement, and contracting), impact our reputation, or otherwise affect our 23 Table of Contents business performance.
Increased attention to climate change and other environmental, social, and governance (“ESG”) issues, as well as societal expectations regarding voluntary ESG initiatives and disclosures, may result in increased costs (including but not limited to costs related to compliance, stakeholder engagement, and contracting), impact our reputation, or otherwise affect our business performance.
In addition, advertisers may not wish to have their brand associated with certain types of content and if we cannot reliably exclude their ads from certain types of content, our business relationships may also be negatively impacted.
In addition, advertisers may not wish to have their brand associated with certain types of content and if we cannot reliably exclude their ads from certain types of content, our business relationships may also be negatively 10 Table of Contents impacted.
These could have a material adverse impact on our business, operating results, and financial condition. Failure to effectively manage and remediate attempts to gain or provide unauthorized access to certain features of our Service could have an adverse impact on our business, operating results, and financial condition.
These could have a material adverse impact on our business, operating results, and financial condition. 24 Table of Contents Failure to effectively manage and remediate attempts to gain or provide unauthorized access to certain features of our Service could have an adverse impact on our business, operating results, and financial condition.
Such litigation, if instituted against us, could result in very substantial costs, divert our management’s attention and resources and harm our business, operating results, and financial condition. Provisions in our articles of association, the issuance of beneficiary certificates, and the existence of certain voting agreements may delay or prevent our acquisition by a third party.
Such litigation, if instituted against us, could result in very substantial costs, divert our management’s attention and resources, and harm our business, operating results, and financial condition. Provisions in our articles of association and the issuance of beneficiary certificates may delay or prevent our acquisition by a third party.
Our products and services are developed, delivered, and maintained through complex technology and third-party SaaS solutions that include various software and hardware. By their very nature, software, hardware, and SaaS solutions contain and are susceptible to unintentional and/or undetected errors, misconfigurations, bugs, and other vulnerabilities, including so-called “zero-day” vulnerabilities.
Our products and services are developed, delivered, and maintained through complex technology and third-party software-as-a-service (“SaaS”) solutions that include various software and hardware. By their very nature, software, hardware, and SaaS solutions contain and are susceptible to unintentional and/or undetected errors, misconfigurations, bugs, and other vulnerabilities, including so-called “zero-day” vulnerabilities.
As a result, the cash payments to the Swedish government upon the exercise of vested stock options may vary significantly from quarter to quarter. Given our levels of share-based compensation, our effective tax rate may vary significantly depending on our share price.
As a result, the cash payments to the Swedish government upon the exercise of vested stock options may vary significantly from quarter to quarter. Given our levels of share-based compensation, our tax expense may vary significantly depending on our share price.
The determination of the amount and timing of such payments is complex and subject to a number of variables, including the type of content streamed, the country in which it is 15 Table of Contents streamed, the product tier such content is streamed on, revenue generated per product tier, the identity of the license holder to whom royalties are owed, the current size of our user base, our current ratio of Ad-Supported Users to Premium Subscribers, the applicability of any most favored nations provisions, and any applicable advertising fees and discounts, among other variables.
The determination of the amount and timing of such payments is complex and subject to a number of variables, including the type of content streamed, the country in which it is streamed, the product tier such content is streamed on, revenue generated per product tier, the identity of the license holder to whom royalties are owed, the current size of our user base, our current ratio of Ad-Supported Users to applicable Premium Subscribers (as defined below), the applicability of any most favored nations provisions, and any applicable advertising fees and discounts, among other variables.
Additionally, the introduction of new products or services, expansion of our activities in certain jurisdictions, entry into new jurisdictions, or other actions that we may take may subject us to additional laws and regulations.
Additionally, the introduction of new products or services, expansion of our activities in certain jurisdictions, entry into new jurisdictions, or other actions that we may take may subject us to additional laws, regulations, or other government scrutiny.
An increase in those fees would require us to either increase the prices we charge for our Premium Service, which could cause us to lose Premium Subscribers and subscription revenue, or suffer an increase in our costs without a corresponding increase in the price we charge for our Premium Service, either of which could harm our business, operating results, and financial condition.
An increase in those fees could require us to either increase the prices we charge for our Subscription Offerings, which could cause us to lose subscribers and subscription revenue, or suffer an increase in our costs without a corresponding increase in the price we charge for our Subscription Offerings, either of which could harm our business, operating results, and financial condition.
The duration of our license agreements that contain minimum guarantees is frequently between one and three years, but our Premium Subscribers may cancel their subscriptions at any time.
The duration of our license agreements that contain minimum guarantees is frequently between one and three years, but subscribers to our Subscription Offerings ("Premium Subscribers") may cancel their subscriptions at any time.
Given the current unsettled nature of the legal and regulatory environment surrounding AI, our AI features and our use, training, and implementation of AI could subject us to new or enhanced governmental or regulatory scrutiny, product restrictions, social and ethical issues, negative consumer perceptions and reputational harm, intellectual property disputes, and other issues, including issues related to cybersecurity and data privacy.
Given the current unsettled nature of the legal and regulatory environment surrounding AI, our AI features and our 19 Table of Contents use, training, and implementation of AI could subject us to new or enhanced governmental or regulatory scrutiny, product restrictions, social and ethical issues, negative consumer perceptions and reputational harm, intellectual property disputes, compliance costs, and other issues, including issues related to cybersecurity and data privacy.
The evolution of privacy laws, including the GDPR, CCPA, and the ePrivacy Directive (each as defined below), may also impact the way we generate revenue from advertising. Failure to successfully monetize and generate revenues from podcasts, audiobooks, and other non-music content could adversely affect our business, operating results, and financial condition.
The evolution of privacy laws, including the GDPR, CCPA, and the ePrivacy Directive (each as defined below), and relevant case law and regulatory guidance, may also impact the way we generate revenue from advertising. Failure to successfully monetize and generate revenues from podcasts, audiobooks, and other non-music content could adversely affect our business, operating results, and financial condition.
Failure to protect our intellectual property could substantially harm our business, operating results, and financial condition. 17 Table of Contents The success of our business depends on our ability to protect and enforce the intellectual property rights underlying our products and services.
Failure to protect our intellectual property could substantially harm our business, operating results, and financial condition. The success of our business depends on our ability to protect and enforce the intellectual property rights underlying our products and services.
An accrual and expense is recognized when it is probable that we will make additional royalty payments under these terms. We cannot assure you that the internal controls and systems we use to determine royalties payable will always be effective.
An accrual and expense is recognized when it is probable that we will make additional royalty payments under these terms. 13 Table of Contents We cannot assure you that the internal controls and systems we use to determine royalties payable will always be effective.
See “Item 8.A. Consolidated Statements and Other Financial Information—Legal or Arbitration Proceedings.” Risks Related to Intellectual Property Assertions by third parties of infringement or other violation by us of their intellectual property rights could harm our business, operating results, and financial condition.
Consolidated Statements and Other Financial Information—Legal or Arbitration Proceedings.” Risks Related to Intellectual Property Assertions by third parties of infringement or other violation by us of their intellectual property rights could harm our business, operating results, and financial condition.
As a result of the complexity and rapid development of AI, it is also the subject of evolving review by various U.S. governmental and regulatory agencies, and other foreign jurisdictions are applying, or are considering applying, their intellectual property, cybersecurity, data protection, and other laws to AI and/or are considering or have proposed general legal frameworks on AI.
As a result of the complexity and rapid development of AI, it is also the subject of evolving review by various governmental and regulatory agencies around the world. Various jurisdictions are applying, or are considering applying, their intellectual property, cybersecurity, data protection, and other laws to AI and/or are considering or have proposed general legal frameworks on AI.
Our ability to grow our business and generate revenue depends on retaining, expanding, and effectively monetizing our total user base, including by increasing the number of subscribers to our premium service (“Premium Service”) and the number of users of our ad-supported service (“Ad-Supported Service”, and together with the Premium Service, the “Service”) and finding ways to monetize our products and services.
Our ability to grow our business and generate revenue depends on retaining, expanding, and effectively monetizing our total user base, including by increasing the number of subscribers to our premium service (“Premium Service”) and other subscription offerings (together with the Premium Service, “Subscription Offerings”) and the number of users of our ad-supported service (“Ad-Supported Service”, and together with the Subscription Offerings, the “Service”) and finding ways to monetize our products and services.
However, managing our business and offering our products and services internationally involves numerous risks and challenges, including: • difficulties in obtaining licenses on favorable terms or at all and maintaining relationships with rights holders; • challenges due to fragmentation of rights ownership and lack of well-functioning copyright collective management organizations; • difficulties in achieving market acceptance and growth in markets with different tastes and interests or where we commit fewer marketing resources; • difficulties in effectively monetizing our growing international user base; • difficulties in managing operations due to language barriers, distance, staffing, user behavior, spending capability, cultural differences, business infrastructure constraints, and laws regulating corporations that operate internationally; • application of different laws and regulations of various jurisdictions, including privacy, telecommunications and media, cybersecurity, content moderation, corporate governance, labor and employment, environmental, human rights, health and safety, consumer protection, liability standards and regulations, as well as intellectual property laws; • potential adverse tax consequences associated with foreign operations; • complex foreign exchange fluctuations, credit risk, payment fraud, restrictions on international monetary flow, and associated issues; • increased competition from local websites and audio content providers; • political, economic, and social instability in some countries; • compliance with the U.S.
Managing our business and offering our products and services internationally involves numerous risks and challenges, including: • difficulties in obtaining licenses on favorable terms or at all and maintaining relationships with rights holders; • challenges due to fragmentation of rights ownership and lack of well-functioning copyright collective management organizations; • difficulties in achieving market acceptance and growth in markets with different tastes and interests or where we commit fewer marketing resources; 6 Table of Contents • difficulties in effectively monetizing our growing international user base; • difficulties in managing operations due to language barriers, distance, staffing, user behavior, spending capability, cultural differences, business infrastructure constraints, and laws regulating corporations that operate internationally; • application of different laws and regulations of various jurisdictions, including privacy, telecommunications and media, cybersecurity, content, AI, corporate governance, labor and employment, environmental, human rights, health and safety, consumer protection, liability standards and regulations, as well as intellectual property laws or changes to such laws that may impact the economics of providing content or increase operating costs in the applicable jurisdiction; • potential adverse tax consequences associated with foreign operations; • complex foreign exchange fluctuations, credit risk, payment fraud, restrictions on international monetary flow, and associated issues; • increased competition from local websites and audio content providers; • political, economic, and social instability in some countries; • compliance with the U.S.
In addition, changes to operating systems' practices and policies, such as Apple's App Tracking Transparency (“ATT”) framework and privacy manifests, have reduced and may continue to reduce the quantity and quality of the data and metrics that can be collected or used by us and our partners.
In addition, changes to operating systems’ practices and policies, such as Apple’s App Tracking Transparency framework, privacy manifests, and software development kit privacy controls have reduced and may continue to reduce the quantity and quality of the data and metrics that can be collected or used by us and our partners.

… 205 more changes not shown on this page.

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

62 edited+6 added−16 removed37 unchanged
We generate revenue for our Premium segment through the sale of subscriptions to the Premium Service. The Premium Service is primarily sold directly to end users. The Premium Service is also sold through partners who are generally telecommunications companies that bundle the subscription with their own services or collect payment for the stand-alone subscriptions from their end customers.
We generate revenue for our Premium segment through the sale of subscriptions to the Subscription Offerings. The Subscription Offerings are primarily sold directly to end users. The Premium Service is also sold through partners who are generally telecommunications companies that bundle the subscription with their own services or collect payment for the stand-alone subscriptions from their end customers.
Revenue from our Ad-Supported segment is dependent primarily on the number and hours of engagement of our Ad-Supported Users and podcast listeners and our ability to provide innovative advertising products that are relevant to those users and enhance returns for our advertising partners. Revenue is recognized based on the number of impressions delivered.
Revenue from our Ad-Supported segment is dependent primarily on the number and hours of engagement of our Ad-Supported Users and podcast listeners and our ability to provide innovative advertising products that are relevant to those users and enhance returns for our advertising partners. Revenue is generally recognized based on the number of impressions delivered.
We offer a variety of subscription pricing plans for our Premium Service, including our Standard Plan, Family Plan, Duo Plan, and Student Plan, among others, to appeal to users with different lifestyles and across various demographics and age groups.
We offer a variety of subscription pricing plans for our Premium Service and Basic plan, including our Standard Plan, Family Plan, Duo Plan, and Student Plan, among others, to appeal to users with different lifestyles and across various demographics and age groups.
Many of these laws and regulations are subject to change and uncertain interpretation, and could result in claims, changes to our business practices, monetary penalties, increased cost of operations, or declines in user growth or engagement, or otherwise harm our business.” and “—Various existing, new, and changing laws and regulations as well as self-regulation and public concern related to privacy and data security pose the threat of lawsuits, regulatory fines, other liability and reputational harm, require us to expend significant resources, and may harm our business, operating results, and financial condition.” 39 Table of Contents Human Capital At Spotify, we know that when our employees grow, Spotify grows.
Many of these laws and regulations are subject to change and uncertain interpretation, and could result in claims, changes to our business practices, monetary penalties, increased cost of operations, or declines in user growth or engagement, or otherwise harm our business.” and “—Various existing, new, and changing laws and regulations as well as self-regulation and public concern related to privacy and data security pose the threat of lawsuits, regulatory fines, other liability and reputational harm, require us to expend significant resources, and may harm our business, operating results, and financial condition.” Human Capital At Spotify, we know that when our employees grow, Spotify grows.
See Note 3 and Note 11 to our consolidated financial statements included elsewhere in this report for additional information. We believe that our existing facilities are adequate to meet current requirements and that suitable additional or substitute space will be available as needed to accommodate any further physical expansion of operations and for any additional offices. Item 4A.
See Note 3 and Note 10 to our consolidated financial statements included elsewhere in this report for additional information. We believe that our existing facilities are adequate to meet current requirements and that suitable additional or substitute space will be available as needed to accommodate any further physical expansion of operations and for any additional offices. Item 4A.
We also lease other offices in Sweden and lease office space in other jurisdictions, including Australia, Belgium, Brazil, Canada, Denmark, Finland, France, Germany, India, Italy, Japan, Luxembourg, Mexico, Netherlands, Argentina, Indonesia, Ireland, South Africa, Singapore, South Korea, Spain, Taiwan, the United Arab Emirates, and the United Kingdom.
We also lease other offices in Sweden and lease office space in other jurisdictions, including Argentina, Australia, Belgium, Brazil, Canada, Denmark, France, Germany, India, Indonesia, Ireland, Italy, Japan, Luxembourg, Mexico, Netherlands, Singapore, South Africa, Spain, Taiwan, the United Arab Emirates, and the United Kingdom.
Organizational Structure The Company’s principal subsidiaries as at December 31, 2023 are as follows: Name Principal activities Proportion of voting rights and shares held (directly or indirectly) Country of incorporation Spotify AB Main operating company 100 % Sweden Spotify USA Inc.
Organizational Structure The Company’s principal subsidiaries as at December 31, 2024 are as follows: Name Principal activities Proportion of voting rights and shares held (directly or indirectly) Country of incorporation Spotify AB Main operating company 100 % Sweden Spotify USA Inc.
Building a Two-Sided Marketplace We continue to build a two-sided marketplace for users and creators, which leverages our relationships, data analytics, and software. We have been instrumental in reshaping the way in which our users enjoy, discover, and share audio content.
We continue to build a two-sided marketplace for users and creators, which leverages our platform relationships, data analytics, and software. We have been instrumental in reshaping the way in which our users enjoy, discover, and share audio content.
We attempt to protect our intellectual property under patent, trade secret, trademark, and copyright laws through a combination of intellectual property registration, employee or third-party assignment and nondisclosure agreements, other contractual restrictions, technological measures, and other methods. 38 Table of Contents Seasonality See “Item 5.D. Trend Information” for a description of the seasonality of our business.
We attempt to protect our intellectual property under patent, trade secret, trademark, and copyright laws through a combination of intellectual property registration, employee or third-party assignment and nondisclosure agreements, other contractual restrictions, technological measures, and other methods. Seasonality See “Item 5.D. Trend Information” for a description of the seasonality of our business.
Government Regulation We are subject to many U.S. federal and state, European, Luxembourg, and other foreign laws and regulations, including those related to privacy, data protection, content, intellectual property, advertising and marketing, competition, consumer protection, rights of publicity, health and safety, employment and labor, and taxation.
Government Regulation 36 Table of Contents We are subject to many U.S. federal and state, European, Luxembourg, and other foreign laws and regulations, including those related to privacy, data protection, content, intellectual property, advertising and marketing, competition, consumer protection, rights of publicity, health and safety, employment and labor, and taxation.
The license agreements also allow for the record label to terminate the agreement in certain circumstances, including, for example, our failure to pay sums due within a certain period, our breach of material terms, and in some situations that could constitute a “change of control” of Spotify.
The license agreements also allow for the record label to terminate the agreement in certain circumstances, including, for example, our 34 Table of Contents failure to pay sums due within a certain period, our breach of material terms, and in some situations that could constitute a “change of control” of Spotify.
They also often include marketing commitments, advertising inventory, financial and data reporting obligations, and numerous prescriptions about the manner in which the Spotify service is operated. Rights to sound recordings granted pursuant to these agreements accounted for approximately 74% of streams of audio content delivered by record labels for the year ended December 31, 2023.
They also often include marketing commitments, advertising inventory, financial and data reporting obligations, and numerous prescriptions about the manner in which the Spotify service is operated. Rights to sound recordings granted pursuant to these agreements accounted for approximately 71% of streams of audio content delivered by record labels for the year ended December 31, 2024.
Premium partner subscription revenue is based on a per-subscriber rate in a negotiated partner agreement. We also bundle the Premium Service with other services and products.
Premium partner subscription revenue is based on a per-subscriber rate in a negotiated partner agreement. We also bundle the Premium Service with other services.
These licenses are generally consumption-based, with royalties paid on a quarterly or monthly basis. In addition, we obtain the rights to produce and distribute audiobooks from book publishers and authors. License Agreement Extensions and Renewals From time to time, our license agreements with certain rights holders and/or their agents expire while we negotiate their renewals.
These licenses are generally consumption-based, with royalties paid on a quarterly or monthly basis. In addition, we obtain the rights to produce and distribute audiobooks from book publishers and authors. License Agreement Extensions and Renewals 35 Table of Contents From time to time, our license agreements with certain rights holders and/or their agents expire while we negotiate their renewals.
Our brand reflects culture—and occasionally creates it—by turning vast and intriguing listening data into compelling stories that remind people of the role music, podcasts, and other audio content play in their lives and encourage new fans to join Spotify each week.
Our brand reflects culture—and occasionally creates 32 Table of Contents it—by turning vast and intriguing listening data into compelling stories that remind people of the role music, podcasts, and other content play in their lives and encourage new fans to join Spotify each week.
We generate revenue for our Ad-Supported segment primarily from the sale of display, audio, and video advertising delivered through advertising impressions across our music and podcast content. We generally enter into arrangements with advertising agencies that purchase advertising on behalf of their clients and we also enter into arrangements directly with some large advertisers.
We generate revenue for our Ad-Supported segment primarily from the sale of display, audio, and video advertising delivered through advertising impressions. We generally enter into arrangements with advertising agencies that purchase advertising on behalf of their clients and we also enter into arrangements directly with some large advertisers.
With the help of our internal talent marketplace, we also offer learning opportunities on the job by connecting employees with projects, jobs, and mentorships to support our internal mobility efforts. In our bi-yearly development talks, managers and employees set a development plan for future development opportunities specific to each individual.
With the help of our internal talent marketplace, we also offer learning opportunities on the job by connecting employees with projects, jobs, and mentorships to support our internal mobility efforts. In our semi-annual development talks, managers and employees set a development plan for future development opportunities specific to each individual.
Through both our online platform and external marketing efforts, we engage our Ad-Supported Users by highlighting key features that encourage conversion to our subscription offerings. These efforts include product links, campaigns targeting existing users, and performance marketing across leading social media platforms.
Through both our online platform and external marketing efforts, we engage our Ad-Supported Users by 33 Table of Contents highlighting key features that encourage conversion to our subscription offerings. These efforts include product links, campaigns targeting existing users, and performance marketing across leading social media platforms.
With our marketplace strategy, we are empowering creators by offering unique insights and developing new tools designed to give creators more power and control and by unlocking new monetization opportunities for creators.
With our marketplace strategy, we are empowering creators by offering unique insights and developing new tools designed to give creators more power and control and by unlocking new monetization opportunities for creators and more ways to connect with fans.
Specifically, we compete with: • free and/or subscription-based digital music streaming providers, such as Apple Music, YouTube Music, Amazon Music, Deezer, Joox, Pandora, SoundCloud, and TikTok Music, for high-quality music content and the time and attention of our users; • online or offline providers of on-demand music, which may be purchased, downloaded, owned, or available for free, such as iTunes audio files, MP3s, or CDs; • providers of internet radio, some of which, such as Pandora, may leverage their advantage in content library, territorial coverage, existing infrastructure, and brand recognition to introduce additional streaming or on-demand music features to enhance user experience; • well-established providers of terrestrial radio, which often offer content that is free, unique and accessible; many terrestrial radio stations also broadcast digital signals providing high-quality audio transmission; • providers of satellite radio, such as SiriusXM, which may offer extensive and exclusive news, comedy, sports and talk content, and national signal coverage; • podcast streaming providers, such as Apple Podcasts, YouTube, Audible, Facebook, Pandora, Deezer, and TuneIn, for high-quality podcasts and time and attention of our users; a growing variety of these podcast providers seek to differentiate their service through content offering, product features, and monetization ability; • podcast creation and hosting platforms, including Acast, Buzzsprout, Podbean, and Libsyn; • live talk audio content providers, such as X (formerly known as Twitter), Discord, Meta (including Facebook and Instagram), and ByteDance (including TikTok and Resso), for the rights to distribute content and time and attention of our users; • audiobook content providers, such as Amazon’s Audible, Apple Books, Google Audiobooks, Librivox, Kobo Audiobooks, Downpour, Storytel, and BookBeat, for the rights to distribute content and time and attention of our users; • companies that offer advertising inventory and opportunities, including large online advertising platforms and networks such as Google, Apple, Amazon, AppNexus, Criteo, and Meta (including Facebook and Instagram).
Specifically, we compete with: • free and/or subscription-based digital music streaming providers, such as Apple Music, YouTube Music, Amazon Music, Deezer, Joox, Pandora, and SoundCloud, for high-quality music content and the time and attention of our users; • online or offline providers of on-demand music, which may be purchased, downloaded, owned, or available for free, such as iTunes audio files, MP3s, or CDs; • providers of internet radio, some of which, such as Pandora, may leverage their advantage in content library, territorial coverage, existing infrastructure, and brand recognition to introduce additional streaming or on-demand music features to enhance user experience; • well-established providers of terrestrial radio, which often offer content that is free, unique and accessible; many terrestrial radio stations also broadcast digital signals providing high-quality audio transmission; • providers of satellite radio, such as SiriusXM, which may offer extensive and exclusive news, comedy, sports and talk content, and national signal coverage; • podcast streaming providers, such as Apple Podcasts, YouTube, Audible, Facebook, Pandora, Deezer, and TuneIn, for high-quality podcasts and time and attention of our users; a growing variety of these podcast providers seek to differentiate their service through content offering, product features, and monetization ability; • podcast creation and hosting platforms, including Acast, Buzzsprout, Podbean, and Libsyn; • audiobook content providers, such as Amazon’s Audible, Apple Books, Google Audiobooks, Librivox, Kobo Audiobooks, Downpour, Storytel, and BookBeat, for the rights to distribute content and time and attention of our users; • companies that offer advertising inventory and opportunities, including large online advertising platforms and networks such as Alphabet, Meta, Amazon, Microsoft, Snap, Pinterest, iHeartMedia, and Pandora.
The Copyright Royalty Board set the rates for the Section 115 compulsory license for calendar years 2018 to 2022 in proceedings known as the “Phonorecords III Proceedings.” On August 10, 2023, the Copyright Royalty Board issued final regulations for the Phonorecords III period.
The Copyright Royalty Board set the rates for the Section 115 compulsory license for calendar years 2018 to 2022 in proceedings known as the “Phonorecords III” proceedings. In August 2023, the Copyright Royalty Board issued final regulations for the Phonorecords III period.
We continue to embrace our Work from Anywhere program adopted in 2021 that allows most employees to elect their work location from physical office space and home mix options. Health, Safety, and Wellness We provide our employees and their families with robust healthcare benefits and a variety of mental health and wellness programs.
We continue to embrace our Work from Anywhere program adopted in 2021 that allows most employees to elect their work location from physical office space, a co-working space, or at home. Health, Safety, and Wellness We provide our employees and their families with robust healthcare benefits and a variety of mental health and wellness programs.
Spotify is uniquely positioned to offer creators and fans access to one another, and to provide creators with analytics and tools to help them better understand their fans, to support themselves, and to effectively monetize their creative work. Our Business Model We offer both Premium and Ad-Supported Services. Our Premium and Ad-Supported Services live independently, but thrive together.
Spotify is uniquely positioned to offer creators and fans access to one another, and to provide creators with analytics and tools to help them better understand their fans, to support themselves, and to effectively monetize their creative work. Our Business Model We offer both Premium and Ad-Supported Services to our customers.
Our approach focuses on two main areas of impact—reducing our greenhouse gas (“GHG”) emissions and using our platform to inspire and support climate engagement and action among creators and listeners. As a digital platform, approximately 99% of our GHG emissions are Scope 3, which means they fall outside our direct control.
Our approach focuses on two main areas of impact—reducing our greenhouse gas (“GHG”) emissions and using our platform to inspire and support climate engagement and action among creators and listeners. 37 Table of Contents As a digital platform, the majority of our GHG emissions are Scope 3, which means they fall outside our direct control.
As a result of this initiative, 41 Table of Contents during the year ended December 31, 2023, we recognized non-cash impairment charges of €123 million, which represents the write-down of these real estate assets, including lease right-of-use assets and property and equipment.
As a result of this initiative, during the years ended December 31, 2024 and 2023, we recognized non-cash impairment charges of €43 million and €123 38 Table of Contents million, respectively, which represents the write-down of these real estate assets, including lease right-of-use assets and property and equipment.
Our Ad-Supported Users and Premium Subscribers spend significant time engaging with our Service. Combined, our audience streamed 165 billion hours of content for the year ended December 31, 2023, an increase of 25% compared to the year ended December 31, 2022.
Our Ad-Supported Users and Premium Subscribers spend significant time engaging with our Service. Combined, our audience streamed 190 billion hours of content for the year ended December 31, 2024, an increase of 15% compared to the year ended December 31, 2023.
Podcast License Agreements with Podcasters and Podcast Networks With respect to podcasts for which we obtain distribution rights directly from rights holders, we either negotiate licenses directly with individuals or entities or obtain rights through our owned and operated services, such as Spotify for Podcasters, that enable creators to distribute content to our Service after agreeing to comply with the applicable terms and conditions.
Podcast License Agreements with Podcasters and Podcast Networks With respect to podcasts in both audio-only and video formats that we license from others, we either negotiate licenses directly with individuals or entities or obtain rights through our owned and operated services, such as Spotify for Creators, that enable creators to distribute content to our Service after agreeing to comply with the applicable terms and conditions.
In 2023, we continued to drive initiatives to reach our long-term goal of net zero emissions by the end of 2030 by identifying levers to reduce our climate impact, together with key partners, industry associates, and academic institutions.
We are teaming up with key partners, industry associates, and academic institutions to drive initiatives to reach our long-term goal of net zero emissions by the end of 2030 by identifying levers to reduce our climate impact.
Revenue from our Premium segment is a function of the number of Premium Subscribers who subscribe to our Premium Service. As of December 31, 2023 and 2022, we had 236 million and 205 million Premium Subscribers, respectively. New Premium Subscribers are primarily sourced from the conversion of our Ad-Supported Users.
Revenue from our Premium segment is a function of the price of our Subscription Offerings and the number of subscribers who subscribe to our Subscription Offerings. As of December 31, 2024 and 2023, we had 263 million and 236 million Premium Subscribers, respectively. New Premium Subscribers are primarily sourced from the conversion of our Ad-Supported Users.
We believe this business model has allowed us to achieve scale with attractive unit economics and is a critical 35 Table of Contents part of our success. Our Ad-Supported Service serves as a funnel, driving a significant portion of our total gross added Premium Subscribers.
Our Premium and Ad-Supported Services live independently, but thrive together. We believe this business model has allowed us to achieve scale with attractive unit economics and is a critical part of our success. Our Ad-Supported Service serves as a funnel, driving a significant portion of our total gross added Premium Subscribers.
Through SPAN, we provide hosting and ad-insertion capabilities for audio publishers that allow us to sell targeted advertising to brand partners that enables them to reach listeners both on and off our platform. Some of these agreements require us to share associated revenues and can include minimum guarantees.
Through SPAN, we provide hosting and ad-insertion capabilities for audio publishers that allow us to sell targeted advertising to brand partners that enables them to reach listeners both on and off our platform. Most of these agreements require us to share associated revenues and can include minimum guarantees. In addition, certain of our two-sided marketplace offerings result in advertising revenues.
We believe offering a more diverse selection of content will lead to a more enriching experience and higher user engagement. Spotify is more than an audio streaming service. We are in the discovery business. Every day, fans from around the world trust our brand to guide them to entertainment that they would never have discovered on their own.
We believe offering a more diverse selection of content will lead to a more enriching experience and higher user engagement. Every day, fans from around the world trust our brand to guide them to entertainment that they would never have discovered on their own.
Additionally, we generate revenue through arrangements with certain advertising automated exchanges, internal self-serve, and advertising marketplace platforms to distribute advertising inventory for purchase on a cost-per-thousand basis. These advertising arrangements typically specify the type of advertising product, pricing, insertion dates, and number of impressions in a stated period.
Additionally, we generate revenue through arrangements with certain advertising automated exchanges, an internal self-serve platform, and advertising marketplace programs to distribute advertising inventory for purchase on an auction or fixed CPM basis. These advertising arrangements typically specify the type of advertising product, pricing, insertion dates, and number of impressions in a stated period.
Premium Subscribers can also purchase audiobooks on an à la carte basis in select markets. In addition to accessing our catalog on computers, tablets, and mobile devices, users can connect through speakers, receivers, televisions, cars, game consoles, and smart devices. The Premium Service offers a music listening experience without commercial breaks.
In addition to accessing our catalog on computers, tablets, and mobile devices, users can connect through speakers, receivers, televisions, cars, game consoles, and smart devices. The Premium Service offers a music listening experience without commercial breaks.
Today, millions of people around the world have access to over 100 million tracks and 5 million podcast titles through Spotify whenever and wherever they want.
Spotify has transformed the way people access and enjoy music, podcasts, and audiobooks. Today, millions of people around the world have access to over 100 million music tracks and 6.5 million podcast titles through Spotify whenever and wherever they want.
We are registered with the Luxembourg Trade and Companies’ Register under number B.123.052. Our registered office is located at 5, place de la Gare L-1616, Luxembourg, Grand Duchy of Luxembourg, and our principal operational office is located at Regeringsgatan 19, 111 53 Stockholm, Sweden.
We are registered with the Luxembourg Trade and Companies’ Register under number B.123.052. Our registered office is located at 33 Boulevard Prince Henri, L-1724 Luxembourg, Grand Duchy of Luxembourg, and our principal operational office is located at Regeringsgatan 19, 111 53 Stockholm, Sweden.
Europe is our largest region with 169 million MAUs, accounting for 28% of our total MAUs as of December 31, 2023, an increase of 14% from the prior year. In our North America region, MAUs increased by 11% from December 31, 2022 to December 31, 2023 and now account for 19% of our MAUs.
Europe is our largest region with 181 million MAUs, accounting for 27% of our total MAUs as of December 31, 2024, an increase of 7% from the prior year. In our North America region, MAUs increased by 4% from December 31, 2023 to December 31, 2024 and now account for 17% of our MAUs.
These advertising arrangements are typically sold on a cost-per-thousand basis and are evidenced by an insertion order that specifies the terms of the arrangement such as the type of advertising product, pricing, insertion dates, and 36 Table of Contents number of impressions or downloads in a stated period ("Insertion Order").
These advertising arrangements are typically sold on a cost-per-thousand impressions (“CPM”) basis and are evidenced by contracts that specify the terms of the arrangement such as the type of advertising product, pricing, insertion dates, and number of impressions in a stated period (“Insertion Order”).
Sales, marketing and other support services 100 % Canada Spotify Australia Pty Ltd Sales and marketing 100 % Australia Spotify Brasil Serviços De Música LTDA Sales and marketing 100 % Brazil Spotify Japan K.K. Sales and marketing 100 % Japan Spotify India LLP Sales, distribution and marketing 100 % India S Servicios de Música México, S.A. de C.V.
Sales, marketing, and other support services 100 % Canada Spotify Australia Pty Ltd Sales, marketing, and other support services 100 % Australia Spotify Brasil Serviços De Música LTDA Sales, marketing, and other support services 100 % Brazil Spotify Japan K.K.
Our two fastest growing regions are Latin America, with 21% of our MAUs, an increase of 25% from December 31, 2022 to December 31, 2023, and the rest of the world, with 32% of our MAUs, an increase of 40% from December 31, 2022 to December 31, 2023.
Our two fastest growing regions are Latin America, with 22% of our MAUs, an increase of 14% from December 31, 2023 to December 31, 2024, and the rest of the world, with 34% of our MAUs, an increase of 20% from December 31, 2023 to December 31, 2024.
Timing and investments to implement our sustainability initiatives are subject to uncertainties. See “Item 3.D. Risk Factors—Risks Related to Our Operations—We are subject to risks associated with increased scrutiny of environmental, social, and governance matters.” C.
Risk Factors—Risks Related to Our Operations—We are subject to risks associated with increased scrutiny of environmental, social, and governance matters.” C.
Ad-Supported Service Our Ad-Supported Service has no subscription fees and generally provides Ad-Supported Users with limited on-demand online access to our catalog of music and unlimited online access to our catalog of podcasts on their computers, tablets, and compatible mobile devices. Ad-Supported Users can also purchase audiobooks on an à la carte basis in select markets.
Ad-Supported Service Our Ad-Supported Service has no subscription fees and generally provides Ad-Supported Users with limited on-demand online access to our catalog of music and unlimited online access to our catalog of podcasts on their computers, tablets, mobile devices, and other smart devices.
Property, Plant and Equipment Spotify’s principal operational offices are located in Stockholm, Sweden and New York, New York under leases for approximately 485,000 and 594,000 square feet of office space, respectively, expiring in December 2028 and April 2034, respectively.
Sales, marketing, and other support services 100 % Italy D. Property, Plant and Equipment Spotify’s principal operational offices are located in Stockholm, Sweden and New York, New York, comprising approximately 485,000 and 594,000 square feet of office space, respectively, with lease terms expiring by December 2028 and April 2034, respectively.
Currently, audiobooks are available for eligible Premium Subscribers in the U.S., U.K., and Australia. We have transformed the music industry by allowing users to move from a “transaction-based” experience of buying and owning music to an “access-based” model, which allows users to stream music on demand.
Since our founding in 2006, we have transformed the music industry by allowing users to move from a “transaction-based” experience of buying and owning music to an “access-based” model, which allows users to stream music on demand.
In 2022, the proceedings known as “Phonorecords IV Proceedings” began to set the rates for the Section 115 blanket compulsory license for calendar years 2023 to 2027.
The Copyright Royalty Board set the rates for the Section 115 blanket compulsory license for calendar years 2023 to 2027 in proceedings known as the “Phonorecords IV” proceedings. In December 2022, the Copyright Royalty Board issued final regulations for the Phonorecords IV period.
We also offer marketplace programs, some of which may result in a discounted recording royalty rate. Musical Composition License Agreements with Music Publishers We generally obtain licenses for two types of rights with respect to musical compositions: mechanical rights and public performance rights.
Musical Composition License Agreements with Music Publishers We generally obtain licenses for two types of rights with respect to musical compositions: mechanical rights and public performance rights.
We continue to leverage our platform to raise awareness of the climate crisis by creating climate change content, including several original podcasts, as well as curating content by updating our Climate Action hub to make climate-related content more accessible to users. As we execute our sustainability initiatives, we expect to incur additional costs.
We also continue to leverage our platform to raise awareness of the climate crisis by creating climate change content as well as curating content to make climate-related content more accessible to users. As we execute our sustainability initiatives, we expect to incur additional costs. Timing and investments to implement our sustainability initiatives are subject to uncertainties. See “Item 3.D.
Offering advertisers additional ways to purchase advertising on an automated basis is a key way that we continue to expand our portfolio of advertising products and enhance advertising revenue. Furthermore, we continue to focus on analytics and measurement tools to evaluate, demonstrate, and improve the effectiveness of advertising campaigns on our platform.
Offering advertisers additional ways to purchase advertising on an automated basis is a key way that we continue to expand our portfolio of advertising products and the number of advertisers we can serve, enhancing our advertising revenue potential.
The majority of these agreements have a multi-year duration, are generally automatically renewable, and apply worldwide (subject to agreement on rates with certain rights holders prior to launching in new territories) but others, with local repertoire, are limited to specific territories. These agreements have financial and data reporting obligations and audit rights.
The majority of these agreements have a multi-year duration, are generally automatically renewable, and apply worldwide, but others, with local repertoire, are limited to specific territories. These agreements have financial and data reporting obligations and audit rights. We also offer marketplace programs, some of which may result in a discounted recording royalty rate.
With respect to mechanical rights, in the United States, the rates that the Copyright Royalty Board set apply to compositions that we license under the compulsory license in Section 115 of the Copyright Act.
With respect to mechanical rights, in the United States, the rates that the Copyright Royalty Board set apply to compositions that we license under the compulsory license in Section 115 of the Copyright Act. In January 2021, we obtained a new blanket compulsory license available under U.S. law, administered by an entity called the Mechanical Licensing Collective.
In February 2021, we announced the Spotify Audience Network (“SPAN”), an audio advertising marketplace that connects advertisers to listeners across our owned and exclusive podcasts, podcasts from enterprise publishers via Megaphone, and podcasts from emerging creators via Spotify for Podcasters.
Furthermore, we continue to focus on analytics and measurement tools to evaluate, demonstrate, and improve the effectiveness of advertising campaigns on our platform. The Spotify Audience Network (“SPAN”) is an audio advertising marketplace that connects advertisers to listeners across our owned and exclusive podcasts, podcasts from enterprise publishers via Megaphone, and podcasts from emerging creators via Spotify for Creators.
In December 2022, the Copyright Royalty Board issued final regulations adopting the parties' proposed rates and terms on an industry-wide basis for the Phonorecords IV period. Royalty rates beginning on January 1, 2028 may differ from those in effect today and are subject to change as part of future Copyright Royalty Board proceedings.
Royalty rates beginning on January 1, 2028 may differ from those in effect today and are subject to change as part of future Copyright Royalty Board proceedings.
Premium Service Our Premium Service provides Premium Subscribers with unlimited online and offline high-quality streaming access to our catalog of music and podcasts. Premium Subscribers in select markets have 15 hours of access a month to audiobooks as part of a subscription to the Premium Service, currently available to eligible Premium Subscribers in the U.S., U.K. and Australia.
Premium Service Our Premium Service provides users with unlimited online and offline high-quality streaming access to our catalog of music and podcasts. In select markets, the Premium Service provides eligible users with limited online and offline streaming access to our catalog of audiobooks.
Through Heart & Soul, our global mental health initiative, we focus on raising awareness and building knowledge, enabling self-care and professional support, and normalizing the conversation around mental health issues. Diversity, Equity, and Inclusion We are dedicated to fostering a workplace free from discrimination and a culture built on the principle of inclusion.
Through Heart & Soul, our global mental health initiative, we focus on raising awareness and building knowledge, enabling self-care and professional support, and normalizing the conversation around mental health issues. Equity, Diversity and Impact Our Equity, Diversity and Impact (“EDI”) efforts focus on pay equity, fairness, and equal access to career growth opportunities.
Sales and marketing 100 % Mexico Spotify Singapore Pte Ltd. Sales and marketing 100 % Singapore Spotify Italy S.r.l. Sales, marketing and other support services 100 % Italy D.
Sales, marketing, and other support services 100 % Japan Spotify India LLP Sales, distribution, and marketing 100 % India S Servicios de Música México, S.A. de C.V. Sales, marketing, and other support services 100 % Mexico Spotify Singapore Pte Ltd. Sales, marketing, and other support services 100 % Singapore Spotify Italy S.r.l.
We seek to compete by offering robust compensation, benefits, health, safety and wellness programs, and cultivating a diverse, inclusive culture.
Additionally, competition to attract and retain qualified personnel has historically been intense, especially for software engineers, designers, and product managers. We seek to compete by offering robust compensation, benefits, health, safety and wellness programs, and cultivating a diverse, inclusive culture.
For original content that we produce or commission, we typically enter into multi-year commitments. Payment terms for content that we produce or commission will often require partial payments in advance of complete delivery of content. Some of these agreements also include financial participations, which may require us to share associated revenues, and other payments contingent on performance of the content.
With respect to podcasts in both audio-only and video formats that we produce or commission, we typically enter into multi-year commitments. Payment terms for content that we produce or commission will often require partial payments in advance of complete delivery of content.
We are the world's most popular audio streaming subscription service with a community of 602 million MAUs, including 236 million Premium Subscribers, across 184 countries and territories as of December 31, 2023. Spotify is the World's Most Popular Audio Streaming Subscription Service Spotify has transformed the way people access and enjoy music and podcasts.
Our agent for U.S. federal securities law purposes is Spotify USA Inc., 150 Greenwich Street, 63rd Floor, New York, New York 10007. B. Business Overview We are the world’s most popular audio streaming subscription service with a community of 675 million MAUs and 263 million Premium Subscribers across 184 countries and territories as of December 31, 2024.
Over 350,000 audiobooks are available à la carte to listen to on Spotify in these markets. During 2023, we launched a new audiobooks experience on our Premium Service, offering 15 hours of access a month to more than 200,000 audiobooks as part of a subscription to the Premium Service.
In select markets, over 350,000 audiobooks are available for à la carte purchase and eligible Premium Subscribers receive a specified number of hours of access a month to a subscriber catalog containing more than 200,000 audiobooks.
To do this, we designed educational programs for inclusive hiring practices with a shift to internal mobility and introduced multiple bias interrupters into the recruiting process. We also continued to support a growing number of Belonging Groups that are open to all employees and help foster belonging and inclusion for our historically marginalized and/or underrepresented talent.
To do this, we embedded inclusion mindset content into our manager training program, co-designed a fair and transparent process for hiring homegrown talent, and continued to support Belonging Groups that are open to all employees and help foster belonging and inclusion for our employees. See “Item 6.D. Employees” for more information about our employees.
We also lease regional offices in Los Angeles, California; San Francisco, California; Boston, Massachusetts; Chicago, Illinois; Atlanta, Georgia; Miami, Florida; Nashville, Tennessee; and Washington D.C.
Currently, we occupy approximately 226,000 and 378,000 square feet of these offices, respectively. The remaining space has been vacated and is intended for sublease, with certain portions already subleased. We also lease regional offices in Los Angeles, California; Miami, Florida; Boston, Massachusetts; Minneapolis, Minnesota; Nashville, Tennessee; and Washington D.C.
Risk Factors—Risks Related to Our Business Model, Strategy, and Performance—We face and will continue to face significant competition for users, user listening time, and advertisers.” Additionally, competition to attract and retain qualified personnel has historically been intense, especially for software engineers, designers, and product managers.
Risk Factors—Risks Related to Our Business Model, Strategy, and Performance—We face and will continue to face significant competition for users, their time, and advertisers.” In addition to competing directly with other providers of music, podcasts, and audiobooks listed above, we also compete for customers’ time and attention with a broad array of other media platforms.
Removed
Our agent for U.S. federal securities law purposes is Eve Konstan, General Counsel, 150 Greenwich Street, 63rd Floor, New York, New York 10007. On March 2, 2021, Spotify USA Inc. issued US$1,500 million in aggregate principal amount of the Exchangeable Notes. Net proceeds from the issuance of the Exchangeable Notes were €1,223 million after deducting transaction costs.
Added
Since 2019, we expanded our podcast offerings and helped advance the growth of the podcast industry by making significant investments in content, giving podcasters scale via our large user base established in music, and enhancing the podcast discovery experience.
Removed
See Note 19 to our consolidated financial statements, included elsewhere in this report, for further information regarding our Exchangeable Notes. On March 29, 2021, we acquired Betty Labs Incorporated for a total purchase consideration of €57 million.
Added
Since 2022, we further expanded our offerings to help drive audiobook adoption among our users and grow the earnings potential of authors, including by bringing elements of our revolutionary music access model to the audiobooks landscape. We are actively investing in other forms of content to complement the music library available through our platform, including video.
Removed
The acquisition allowed us to explore the live audio space. 34 Table of Contents On June 17, 2021, we acquired Podz, Inc., a technology company focused on the podcast discovery experience, for a total purchase consideration of €45 million.
Added
As part of our Subscription Offerings, we also offer a Basic plan to eligible users in select markets that provides certain benefits of the Premium Service without the monthly audiobook listening time and an Audiobook Access Tier in the U.S. that provides specified hours of audiobook access a month without all of the benefits of the Premium Service.
Removed
The acquisition allows us to complement and accelerate our focused efforts to drive podcast discovery, deliver listeners the right content at the right time, and accelerate growth of the podcast category worldwide. During February 2022, we acquired In Defense of Growth Inc. ("Podsights") and Chartable Holding, Inc.
Added
Some of the agreements relating to either licensed or original content also include financial participations, which may require us to share portions of certain associated revenues.
Removed
("Chartable") to provide improved podcast ad measurement and analytics services for a total purchase consideration of €83 million. These acquisitions allow us to expand and scale our podcast monetization and product offering for advertisers and publishers. On June 15, 2022, we acquired Findaway World, LLC (“Findaway”), a digital audiobook distribution platform, for a total purchase consideration of €117 million.
Added
EDI not only contributes to a workplace where everyone can thrive but also powers innovation and helps bring our values to life. During 2024, we continued our efforts to build a team that attracts, grows, and retains talent from all backgrounds.
Removed
This acquisition allows us to accelerate our audiobook content offering. On July 11, 2022, we acquired Sonantic Limited ("Sonantic"), an artificial intelligence voice platform, for a total purchase consideration of €93 million. This acquisition allows us to expand text-to-speech capabilities across our platform. See Note 5 to our consolidated financial statements included elsewhere in this report. B.
Added
Environmental Sustainability We strive to be part of the solution for addressing the climate crisis through our operations.
Removed
Business Overview Our mission is to unlock the potential of human creativity by giving a million creative artists the opportunity to live off their art and billions of fans the opportunity to enjoy and be inspired by it.
Removed
In September 2022, we made available a catalog of audiobooks in the United States that our users may purchase on the web and listen to on our platform alongside our catalog of music and podcasts. In November 2022, we extended audiobooks availability to the United Kingdom, Ireland, Australia, and New Zealand.
Removed
In contrast, traditional radio relies on a linear distribution model in which stations and channels are programmed to deliver a limited song selection with little freedom of choice. We are actively investing in podcasts, audiobooks, and other forms of alternative and spoken word content to complement the music library available through our platform.
Removed
In January 2021, we obtained a 37 Table of Contents new blanket compulsory license available under U.S. law, administered by an entity called the Mechanical Licensing Collective.
Removed
In August 2022, we and other service providers reached an agreement in principle with publisher organizations for these rates and terms and asked the Copyright Royalty Board to adopt those rates and terms on an industry-wide basis.
Removed
Our Diversity, Equity, and Inclusion team focused on accelerating diversity, designing for equity, fostering inclusive leadership, enabling good mental health, co-designing equitable ways of working, building a culture of allyship, and amplifying a sense of belonging. During 2023, we continued our efforts to build a diverse team that attracts and retains talent from historically marginalized and/or underrepresented backgrounds.

… 4 more changes not shown on this page.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

125 edited+30 added−41 removed62 unchanged
MAUs increased due to our continued investment in driving the growth of our Service through successful consumer marketing campaigns, enhanced content offerings, and product enhancements, resulting in continued user engagement and customer satisfaction. Premium Subscribers We define Premium Subscribers as users that have completed registration with Spotify and have activated a payment method for Premium Service.
MAUs increased due to our continued investment in driving the growth of our Service through successful consumer marketing campaigns, enhanced content offerings, and product enhancements, resulting in continued user engagement and customer satisfaction. Premium Subscribers We define Premium Subscribers as users that have completed registration with Spotify and have activated a payment method for the Subscription Offerings.
They are accounted for in their entirety at fair value, with any change in fair value after initial measurement being recorded in finance income or cost in the consolidated statement of operations, except that changes in fair value that are due to changes in own credit risk will be presented separately in other comprehensive income/(loss) and will not be reclassified to the consolidated statement of operations.
They are accounted for in their entirety at fair value, with any change in fair value after initial measurement being recorded in finance income or cost in the consolidated statement of operations, except that changes in fair value that are due to changes in own credit risk will be presented separately in other comprehensive income and will not be reclassified to the consolidated statement of operations.
Cost of revenue consists predominantly of royalty and distribution costs related to content streaming. We incur royalty costs, which we pay to certain record labels, music publishers, and other rights holders, for the right to stream content to our users. Music royalties are typically calculated monthly based on the combination of a number of different variables.
Cost of revenue consists predominantly of royalty and distribution costs related to content streaming. We incur royalty costs, which we pay to certain record labels, music publishers, audiobook publishers, and other rights holders, for the right to stream content to our users. Music royalties are typically calculated monthly based on the combination of a number of different variables.
The targets can include such measures as the number of Premium Subscribers, the ratio of Ad-Supported Users to Premium Subscribers, and/or the rates of Premium Subscriber churn. In addition, royalty rates vary by country. Some of our royalty agreements require that royalty costs be paid in advance or are subject to minimum guaranteed amounts.
The targets can include such measures as the number of applicable Premium Subscribers, the ratio of Ad-Supported Users to applicable Premium Subscribers, and/or the rates of applicable Premium Subscriber churn. In addition, royalty rates vary by country. Some of our royalty agreements require that royalty costs be paid in advance or are subject to minimum guaranteed amounts.
Expenses primarily comprise costs incurred for the development of products related to our platform and Service, as well as new advertising products and improvements to our mobile application and desktop application and streaming services. The costs incurred include related facility costs, consulting costs, and employee compensation and benefits costs.
Expenses primarily comprise costs incurred for the development of products related to our platform and Service, as well as new and existing advertising products and improvements to our mobile application and desktop application and streaming services. The costs incurred include related facility costs, consulting costs, and employee compensation and benefits costs.
Other than as disclosed here and elsewhere in this report, we are not aware of any trends, uncertainties, demands, commitments, or events since December 31, 2023 that are reasonably likely to have a material effect on our revenues, income, profitability, liquidity, or capital resources, or that would cause the disclosed financial information to be not necessarily indicative of future operating results or financial conditions.
Other than as disclosed here and elsewhere in this report, we are not aware of any trends, uncertainties, demands, commitments, or events since December 31, 2024 that are reasonably likely to have a material effect on our revenues, income, profitability, liquidity, or capital resources, or that would cause the disclosed financial information to be not necessarily indicative of future operating results or financial conditions.
Our MAUs in the tables below are inclusive of Ad-Supported Users who may have employed methods to limit or otherwise avoid being served advertisements. For additional information, refer to the risk factors discussed under “Item 3.D. Risk Factors” included elsewhere in this report. The table below sets forth our MAUs as of December 31, 2023, 2022, and 2021.
Our MAUs in the tables below are inclusive of Ad-Supported Users who may have employed methods to limit or otherwise avoid being served advertisements. For additional information, refer to the risk factors discussed under “Item 3.D. Risk Factors” included elsewhere in this report. The table below sets forth our MAUs as of December 31, 2024, 2023, and 2022.
Risk Factors—Risks Related to Our Operations—We may require additional capital to support business growth and objectives, and this capital might not be available on acceptable terms, if at all.” We continue to evaluate our real estate footprint to optimize our global office space while making necessary investments in offices and information technology infrastructure to grow our business.
Risk Factors—Risks Related to Our Operations—We may require additional capital to support our strategic objectives, and this capital might not be available on acceptable terms, if at all.” We continue to evaluate our real estate footprint to optimize our global office space while making necessary investments in offices and information technology infrastructure to grow our business.
See Note 23 to our consolidated financial statements included elsewhere in this report for additional information on the valuation models used for our warrants. Income Taxes We are subject to income taxes in Luxembourg, Sweden, the United States, and numerous foreign jurisdictions. Significant judgment is required in determining our uncertain tax positions.
See Note 22 to our consolidated financial statements included elsewhere in this report for additional information on the valuation models used for our warrants. Income Taxes We are subject to income taxes in Luxembourg, Sweden, the United States, and numerous foreign jurisdictions. Significant judgment is required in determining our uncertain tax positions.
If we conclude that it is not probable that our tax position will be accepted, the effect of that uncertainty is reflected at either the most likely amount or the expected value, taking into account a range of possible outcomes. The resolution of tax examinations and the APA may be significant to the consolidated financial statements.
If we conclude that it is not probable that our tax position will be accepted, the effect of that uncertainty is reflected at either the most likely amount or the expected value, taking into account a range of possible outcomes. The resolution of tax examinations may be significant to the consolidated financial statements.
Management's estimates of recoverable amounts are based upon assumptions believed to be reasonable, but which are inherently uncertain and unpredictable and, as a result, actual results may differ from estimates. See Note 11 to our consolidated financial statements included elsewhere in this report for additional information.
Management’s estimates of recoverable amounts are based upon assumptions believed to be reasonable, but which are inherently uncertain and unpredictable and, as a result, actual results may differ from estimates. See Note 10 to our consolidated financial statements included elsewhere in this report for additional information.
We invest heavily in research and development in order to drive user engagement and customer satisfaction on our platform, which we believe helps drive organic growth in MAUs, which in turn drives additional 44 Table of Contents growth in, and better retention of, Premium Subscribers, as well as increased advertising opportunities to our users.
We invest heavily in research and development in order to drive user engagement and customer satisfaction on our platform, which we believe helps drive organic growth in MAUs, which, in turn, drives additional 41 Table of Contents growth in, and better retention of, Premium Subscribers, as well as increased advertising opportunities to our users.
Ad-Supported MAUs We define Ad-Supported MAUs as the total count of Ad-Supported Users that have consumed content for greater than zero milliseconds in the last thirty days from the period-end indicated. The table below sets forth our Ad-Supported MAUs as of December 31, 2023, 2022, and 2021.
Ad-Supported MAUs We define Ad-Supported MAUs as the total count of Ad-Supported Users that have consumed content for greater than zero milliseconds in the last thirty days from the period-end indicated. The table below sets forth our Ad-Supported MAUs as of December 31, 2024, 2023, and 2022.
These minimum guarantee amounts have been disclosed in Note 25 of the consolidated financial statements included elsewhere in this report. An accrual is established when actual royalty costs to be incurred during a contractual period are expected to fall short of the minimum guaranteed amounts.
These minimum guarantee amounts have been disclosed in Note 24 of the consolidated financial statements included elsewhere in this report. An accrual is established when actual royalty costs to be incurred during a contractual period are expected to fall short of the minimum guaranteed amounts.
We aim to design products and features that create and enhance user experiences, and new technologies are at the core of many of these opportunities. Research and development expenses were 13%, 12%, and 9% of our total revenue in each of 2023, 2022, and 2021, respectively.
We aim to design products and features that create and enhance user experiences, and new technologies are at the core of many of these opportunities. Research and development expenses were 9%, 13%, and 12% of our total revenue in each of 2024, 2023, and 2022, respectively.
The assumptions used for estimating fair value and assessing available headroom based on conditions that existed at the testing date are disclosed in Note 13 to our consolidated financial statements included elsewhere in this report.
The assumptions used for estimating fair value and assessing available headroom based on conditions that existed at the testing date are disclosed in Note 12 to our consolidated financial statements included elsewhere in this report.
Additionally, though we strive to detect and minimize non-bona fide accounts that may typically be created in an attempt to artificially stream content, they may contribute, from time to time, to an overstatement in our reported MAUs.
Additionally, although we strive to detect and minimize non-bona fide accounts that may typically be created in an attempt to artificially stream content, they may contribute, from time to time, to an overstatement in our reported MAUs.
From a product perspective, while our Family Plan, Duo Plan, and our Student Plan have lower price points per Premium Subscriber than our Standard plan, each of these Plans has helped improve retention across the Premium Service. Our platform is built to work across multiple devices, including smartphones, desktops, cars, game consoles, and in-home devices.
From a product perspective, while our Family Plan, Duo Plan, and our Student Plan have lower price points per Premium Subscriber than our Standard plan, each of these Plans has aided retention across the Premium Service. Our platform is built to work across multiple devices, including smartphones, desktops, cars, game consoles, and in-home devices.
To the extent that the final tax outcome of these matters is different 56 Table of Contents than the amounts recorded, such differences will affect the provision for income taxes in the period in which such determination is made and could have a material impact on our financial condition and operating results.
To the extent that the final tax outcome of these matters is different than the amounts recorded, such differences will affect the provision for income taxes in the period in which such determination is made and could have a material impact on our financial condition and operating results.
Impairment of real estate assets In connection with the Office Space Optimization Initiative, we have recognized non-cash impairment charges to write-down the related real estate assets, which included lease right-of-use assets, leasehold improvements and property and equipment, to their recoverable amounts.
Impairment of real estate assets 53 Table of Contents In connection with the Office Space Optimization Initiative, we have recognized non-cash impairment charges to write-down the related real estate assets, which included lease right-of-use assets, leasehold improvements and property and equipment, to their recoverable amounts.
Item 5. Operating and Financial Review and Prospects For discussion related to our financial condition, changes in financial condition, and results of operations for 2022 compared to 2021, refer to Part I, Item 5.
Item 5. Operating and Financial Review and Prospects For discussion related to our financial condition, changes in financial condition, and results of operations for 2023 compared to 2022, refer to Part I, Item 5.
See Note 3 and Note 11 to our consolidated financial statements included elsewhere in this report for further details. Current macroeconomic environment The global macroeconomic environment continues to be uncertain, reflecting the impacts of inflation, changes in interest rates, geopolitical conflicts in Europe and the Middle East, and related market uncertainty.
See Note 3 and Note 10 to our consolidated financial statements included elsewhere in this report for further details. Current macroeconomic environment The global macroeconomic environment continues to be uncertain, reflecting the impacts of inflation, changes in interest rates, changes in trade policies, geopolitical conflicts in Europe and the Middle East, and related market uncertainty.
Recent Accounting Pronouncements See Note 2 to our consolidated financial statements included elsewhere in this report for recently adopted accounting pronouncements and recently issued accounting pronouncements not yet adopted as of the dates of the statement of financial position included in this report. 57 Table of Contents
Recent Accounting Pronouncements See Note 2 to our consolidated financial statements included elsewhere in this report for recently adopted accounting pronouncements and recently issued accounting pronouncements not yet adopted as of the dates of the statement of financial position included in this report.
We generate revenue for our Ad-Supported segment primarily from the sale of display, audio, and video advertising delivered through advertising impressions across our music and podcast content. We generally enter into arrangements with advertising agencies that purchase advertising on behalf of their clients and we also enter into arrangements directly with some large advertisers.
We generate revenue for our Ad-Supported segment primarily from the sale of display, audio, and video advertising delivered through advertising impressions. We generally enter into arrangements with advertising agencies that purchase advertising on behalf of their clients and we also enter into arrangements directly with some large advertisers.
Revenue from our Ad-Supported segment is dependent primarily on the number and hours of engagement of our Ad-Supported Users and podcast listeners and our ability to provide innovative advertising products that are relevant to those users and enhance returns for our advertising partners. Revenue is recognized based on the number of impressions delivered.
Revenue from our Ad-Supported segment is dependent primarily on the number and hours of engagement of our Ad-Supported Users and podcast listeners and our ability to provide innovative advertising products that are relevant to those users 40 Table of Contents and enhance returns for our advertising partners. Revenue is generally recognized based on the number of impressions delivered.
A higher revised forfeiture rate than previously estimated will result in an adjustment that will decrease the stock-based compensation expense recognized in the consolidated statement of 54 Table of Contents operations. A lower revised forfeiture rate than previously estimated will result in an adjustment that will increase the stock-based compensation expense recognized in the consolidated statement of operations.
A higher revised forfeiture rate than previously estimated will result in an adjustment that will decrease the stock-based compensation expense recognized in the consolidated statement of operations. A lower revised forfeiture rate than previously estimated will result in an adjustment that will increase the stock-based compensation expense recognized in the consolidated statement of operations.
Impairment of real estate assets As a result of the Office Space Optimization Initiative, during the year ended December 31, 2023, we recognized non-cash impairment charges of €123 million, which represents the write-down of these real estate assets, including lease right-of-use assets, leasehold improvements and property and equipment.
Impairment of real estate assets As a result of the Office Space Optimization Initiative, during the years ended December 31, 2024 and 2023, we recognized non-cash impairment charges of €43 million and €123 million, respectively, which represents the write-down of these real estate assets, including lease right-of-use assets, leasehold improvements and property and equipment.
You should not consider Free Cash Flow in isolation, or as a substitute for an analysis of our results as reported on our consolidated financial statements appearing elsewhere in this report. For the year ended December 31, 2023, as compared to 2022, Free Cash Flow increased by €657 million.
You should not consider Free Cash Flow in isolation, or as a substitute for an analysis of our results as reported on our consolidated financial statements appearing elsewhere in this report. For the year ended December 31, 2024, as compared to 2023, Free Cash Flow increased by €1,607 million.
Premium Subscribers include subscribers in a grace period of up to 30 days after failing to pay their subscription fee. 45 Table of Contents The table below sets forth our Premium Subscribers as of December 31, 2023, 2022, and 2021.
Premium Subscribers include subscribers in a grace period of up to 30 days after failing to pay their subscription fee. 42 Table of Contents The table below sets forth our Premium Subscribers as of December 31, 2024, 2023, and 2022.
Of the total accruals and provisions to rights holders at December 31, 2023 and December 31, 2022, approximately €455 million and €441 million, respectively, relate to liabilities that were incurred more than 12 months prior to the date of the statement of financial position.
Of the total accruals and provisions to rights holders at December 31, 2024 and December 31, 2023, approximately €351 million and €455 million, respectively, relate to liabilities that were incurred more than 12 months prior to the date of the statement of financial position.
Deferred tax assets are recognized for unused tax losses, unused tax credits, and deductible temporary differences to the extent that it is probable that future taxable profits will be available, against which they can be used.
Deferred tax assets in excess of deferred tax liabilities are recognized for unused tax losses, unused tax credits, and deductible temporary differences to the extent that it is probable that future taxable profits will be available, against which they can be used.
Generally, Premium Service royalties are based on the greater of a percentage of revenue and a per user amount. Royalties for the Ad-Supported Service are typically a percentage of relevant revenue, although certain agreements are based on the greater of a percentage of relevant revenue and an amount for each time a track is streamed.
Generally, Subscription Offering music royalties are based on the greater of a percentage of relevant revenue and a per user amount. Music royalties for the Ad-Supported Service are typically a percentage of relevant revenue, although certain agreements are based on the greater of a percentage of relevant revenue and an amount for each time a track is streamed.
Risk Factors—Risks Related to Securing the Rights to the Content We Stream—Our royalty payment scheme is complex, and it is difficult to estimate the amount payable under our license agreements or relevant statutes.” Exchangeable Notes Our Exchangeable Notes are re-measured at each reporting date using valuation models using input data.
Risk Factors—Risks Related to Securing the Rights to the Content We Stream—Our royalty payment system is complex, and it is difficult to estimate the amount payable under our license agreements or relevant statutes.” 52 Table of Contents Exchangeable Notes Our Exchangeable Notes are re-measured at each reporting date using valuation models using input data.
We estimate that total revenue for the year ended December 31, 2023 would have been approximately €399 million higher if foreign exchange rates had remained consistent with foreign exchange rates for the year ended December 31, 2022.
We estimate that total revenue for the year ended December 31, 2024 would have been approximately €243 million higher if foreign exchange rates had remained consistent with foreign exchange rates for the year ended December 31, 2023.
We estimate that total cost for the year ended December 31, 2023 would have been approximately €305 million higher, if foreign exchange rates had remained consistent with foreign exchange rates for the year ended December 31, 2022.
We estimate that total cost for the year ended December 31, 2024 would have been approximately €181 million higher, if foreign exchange rates had remained consistent with foreign exchange rates for the year ended December 31, 2023.
Based on our definition, our Free Cash Flow is summarized as follows: Year ended December 31, 2023 2022 2021 (in € millions) Net cash flows from operating activities 680 46 361 Capital expenditures (6) (25) (85) Change in restricted cash 4 — 1 Free Cash Flow 678 21 277 We believe Free Cash Flow is a useful supplemental financial measure for us and investors in assessing our ability to pursue business opportunities and investments and to service our debt.
Based on our definition, our Free Cash Flow is summarized as follows: Year ended December 31, 2024 2023 2022 (in € millions) Net cash flows from operating activities 2,301 680 46 Capital expenditures (17) (6) (25) Change in restricted cash 1 4 — Free Cash Flow 2,285 678 21 We believe Free Cash Flow is a useful supplemental financial measure for us and investors in assessing our ability to pursue business opportunities and investments and to service our debt.
Operating and Financial Review and Prospects.” D. Trend Information Our results reflect the effects of our trial programs, both discounted and free trials, in addition to seasonal trends in user behavior and, with respect to our Ad-Supported segment, advertising behavior. Historically, Premium Subscriber growth accelerates when we run such trial programs.
Business Overview” and discussions elsewhere in this “Item 5. Operating and Financial Review and Prospects.” D. Trend Information Our results reflect the effects of our trial programs, both discounted and free trials, in addition to seasonal trends in user behavior and, with respect to our Ad-Supported segment, advertising behavior. Historically, Premium Subscriber growth accelerates when we run such trial programs.
This will result in a reduction of our real estate footprint as we have decided to sublease certain leased office space. See Note 3 and Note 11 to our consolidated financial statements included elsewhere in this report for additional information.
This has resulted in a reduction of our real estate footprint as we have decided to sublease certain leased office space. See Note 3 and Note 10 to our consolidated financial statements included elsewhere in this report for additional information.
The fair value of an RSU or restricted stock award is measured using the fair value of our ordinary shares on the date of the grant. Stock-based compensation expense is recognized, net of forfeitures, over the requisite service periods of the awards, which is generally less than five years.
The fair value of an RSU or restricted stock award is measured using the fair value of our ordinary shares on the date of the grant. Stock-based compensation expense is recognized, net of forfeitures, over the requisite service periods of the awards, which is four years from the grant date.
Sales and marketing Year ended December 31, Change 2023 2022 2021 2023 vs. 2022 2022 vs. 2021 (in € millions, except percentages) Sales and marketing 1,533 1,572 1,135 (39) (2) % 437 39 % As a percentage of revenue 12 % 13 % 12 % For the year ended December 31, 2023, as compared to 2022, sales and marketing expense decreased by €39 million, or 2%.
Sales and marketing Year ended December 31, Change 2024 2023 2022 2024 vs. 2023 2023 vs. 2022 (in € millions, except percentages) Sales and marketing 1,392 1,533 1,572 (141) (9) % (39) (2) % As a percentage of revenue 9 % 12 % 13 % For the year ended December 31, 2024, as compared to 2023, sales and marketing expense decreased by €141 million, or 9%.
See Part I, “Item 3.D. Risk Factors”. (2) Consists of principal on our 0.00% Exchangeable Notes due March 15, 2026. (3) Included in the lease obligations are short term leases and certain lease agreements that we have entered into, but had not yet commenced as of December 31, 2023. Lease obligations primarily relate to our office space.
See Part I, “Item 3.D. Risk Factors.” (2) Consists of principal on our 0.00% Exchangeable Notes due March 15, 2026. (3) Included in the lease obligations are short term leases and certain lease agreements that we have entered into, but had not yet commenced as of December 31, 2024.
We also bundle the Premium Service with other services and products. We offer a variety of subscription pricing plans for our Premium Service, including our Standard Plan, Family Plan, Duo Plan, and Student Plan, among others, to appeal to users with different lifestyles and across various demographics and age groups.
We offer a variety of subscription pricing plans for our Premium Service and Basic plan, including our Standard Plan, Family Plan, Duo Plan, and Student Plan, among others, to appeal to users with different lifestyles and across various demographics and age groups.
Year ended December 31, Change 2023 2022 2021 2023 vs. 2022 2022 vs. 2021 (in € millions, except percentages) Finance costs (220) (132) (91) (88) 67 % (41) 45 % As a percentage of revenue (2) % (1) % (1) % For the year ended December 31, 2023, as compared to 2022, finance costs increased by €88 million.
Year ended December 31, Change 2024 2023 2022 2024 vs. 2023 2023 vs. 2022 (in € millions, except percentages) Finance costs (352) (220) (132) (132) 60 % (88) 67 % As a percentage of revenue (2) % (2) % (1) % For the year ended December 31, 2024, as compared to 2023, finance costs increased by €132 million.
Revenue from our Premium segment is a function of the number of Premium Subscribers who subscribe to our Premium Service. As of December 31, 2023 and 2022, we had 236 million and 205 million Premium Subscribers, respectively. New Premium Subscribers are primarily sourced from the conversion of our Ad-Supported Users.
Revenue from our Premium segment is a function of the price of our Subscription Offerings and the number of subscribers who subscribe to our Subscription Offerings. As of December 31, 2024 and 2023, we had 263 million and 236 million Premium Subscribers, respectively. New Premium Subscribers are primarily sourced from the conversion of our Ad-Supported Users.
Through SPAN, we provide hosting and ad-insertion capabilities for audio publishers that allow us to sell targeted advertising to brand partners that enables them to reach listeners both on and off our platform. Some of these agreements require us to share associated revenues and can include minimum guarantees.
Through SPAN, we provide hosting and ad-insertion capabilities for audio publishers that allow us to sell targeted advertising to brand partners that enables them to reach listeners both on and off our platform. Most of these agreements require us to share associated revenues and can include minimum guarantees. In addition, certain of our two-sided marketplace offerings result in advertising revenues.
General and administrative Year ended December 31, Change 2023 2022 2021 2023 vs. 2022 2022 vs. 2021 (in € millions, except percentages) General and administrative 585 626 450 (41) (7) % 176 39 % As a percentage of revenue 4 % 5 % 5 % For the year ended December 31, 2023, as compared to 2022, general and administrative expense decreased by €41 million or 7%.
General and administrative Year ended December 31, Change 2024 2023 2022 2024 vs. 2023 2023 vs. 2022 (in € millions, except percentages) General and administrative 481 585 626 (104) (18) % (41) (7) % As a percentage of revenue 3 % 4 % 5 % For the year ended December 31, 2024, as compared to 2023, general and administrative expense decreased by €104 million or 18%.
See Note 23 to our consolidated financial statements included elsewhere in this report for additional information on the valuation models used for our Exchangeable Notes. Warrants We issued certain non-compensatory warrants in the Company to a holder that is an employee and a member of management of the Group pursuant to a subscription agreement. See "Item 6.
See Note 22 to our consolidated financial statements included elsewhere in this report for additional information on the valuation models used for our Exchangeable Notes. Warrants We issued certain non-compensatory warrants in the Company to a holder that is an employee and a member of management of Spotify Technology S.A. and its subsidiaries (the “Group”) pursuant to a subscription agreement.
As of December 31, Change 2023 2022 2021 2023 vs. 2022 2022 vs. 2021 (in millions, except percentages) Ad-Supported MAUs 379 295 236 84 28 % 59 25 % Ad-Supported MAUs were 379 million as of December 31, 2023. This represented an increase of 28% from the preceding fiscal year.
As of December 31, Change 2024 2023 2022 2024 vs. 2023 2023 vs. 2022 (in millions, except percentages) Ad-Supported MAUs 425 379 295 46 12 % 84 28 % Ad-Supported MAUs were 425 million as of December 31, 2024. This represented an increase of 12% from the preceding fiscal year.
In addition to accessing our catalog on computers, tablets, and mobile devices, users can connect through speakers, receivers, televisions, cars, game consoles, and smart devices. The Premium Service offers a music listening experience without commercial breaks. We generate revenue for our Premium segment through the sale of subscriptions to the Premium Service.
In addition to accessing our catalog on computers, tablets, and mobile devices, users can 39 Table of Contents connect through speakers, receivers, televisions, cars, game consoles, and smart devices. The Premium Service offers a music listening experience without commercial breaks.
As of December 31, Change 2023 2022 2021 2023 vs. 2022 2022 vs. 2021 (in millions, except percentages) MAUs 602 489 406 113 23 % 83 20 % MAUs were 602 million as of December 31, 2023. This represented an increase of 23% from the preceding fiscal year.
As of December 31, Change 2024 2023 2022 2024 vs. 2023 2023 vs. 2022 (in millions, except percentages) MAUs 675 602 489 73 12 % 113 23 % MAUs were 675 million as of December 31, 2024. This represented an increase of 12% from the preceding fiscal year.
As of December 31, Change 2023 2022 2021 2023 vs. 2022 2022 vs. 2021 (in millions, except percentages) Premium Subscribers 236 205 180 31 15 % 25 14 % Premium Subscribers were 236 million as of December 31, 2023. This represented an increase of 15% from the preceding fiscal year.
As of December 31, Change 2024 2023 2022 2024 vs. 2023 2023 vs. 2022 (in millions, except percentages) Premium Subscribers 263 236 205 27 11 % 31 15 % Premium Subscribers were 263 million as of December 31, 2024. This represented an increase of 11% from the preceding fiscal year.
Three months ended December 31, Change 2023 2022 2021 2023 vs. 2022 2022 vs. 2021 Premium ARPU € 4.60 € 4.55 € 4.40 € 0.05 1 % € 0.15 3 % For the quarter ended December 31, 2023, Premium ARPU was €4.60. This represented an increase of 1% year-over-year.
Three months ended December 31, Change 2024 2023 2022 2024 vs. 2023 2023 vs. 2022 Premium ARPU € 4.85 € 4.60 € 4.55 € 0.25 5 % € 0.05 1 % For the quarter ended December 31, 2024, Premium ARPU was €4.85. This represented an increase of 5% year-over-year.
Income tax expense Year ended December 31, Change 2023 2022 2021 2023 vs. 2022 2022 vs. 2021 (in € millions, except percentages) Income tax expense 27 60 283 (33) (55) % (223) (79) % As a percentage of revenue — % 1 % 3 % For the year ended December 31, 2023 , income tax expense was €27 million, as compared to income tax expense of €60 million for the year ended December 31, 2022.
Income tax expense Year ended December 31, Change 2024 2023 2022 2024 vs. 2023 2023 vs. 2022 (in € millions, except percentages) Income tax expense 203 27 60 176 652 % (33) (55) % As a percentage of revenue 1 % — % 1 % For the year ended December 31, 2024 , income tax expense was €203 million, as compared to income tax expense of €27 million for the year ended December 31, 2023.
The table below sets forth our average Premium ARPU for the years ended December 31, 2023, 2022, and 2021. Year ended December 31, Change 2023 2022 2021 2023 vs. 2022 2022 vs. 2021 Premium ARPU € 4.39 € 4.52 € 4.29 € (0.13) (3) % € 0.23 5 % For the year ended December 31, 2023, Premium ARPU was €4.39.
The table below sets forth our average Premium ARPU for the years ended December 31, 2024, 2023, and 2022. Year ended December 31, Change 2024 2023 2022 2024 vs. 2023 2023 vs. 2022 Premium ARPU € 4.69 € 4.39 € 4.52 € 0.30 7 % € (0.13) (3) % For the year ended December 31, 2024, Premium ARPU was €4.69.
With a presence in 184 countries and territories, our platform includes 602 million MAUs and 236 million Premium Subscribers as of December 31, 2023. We currently monetize our Service through both subscriptions and advertising. Our Premium Subscribers grew 15% year-over-year as of December 31, 2023 to 236 million. Our 602 million MAUs grew 23% year-over-year as of December 31, 2023.
With a presence in 184 countries and territories, our platform includes 675 million MAUs and 263 million Premium Subscribers as of December 31, 2024. We currently monetize our Service through both subscriptions and advertising. Our Premium Subscribers grew 11% year-over-year as of December 31, 2024 to 263 million. Our 675 million MAUs grew 12% year-over-year as of December 31, 2024.
Ad-Supported revenue For the years ended December 31, 2023 and 2022, Ad-Supported revenue comprised 13% of our total revenue. For the year ended December 31, 2023, as compared to 2022, Ad-Supported revenue increased by €205 million or 14%.
Ad-Supported revenue For the years ended December 31, 2024 and 2023, Ad-Supported revenue comprised 12% and 13%, respectively, of our total revenue. For the year ended December 31, 2024, as compared to 2023, Ad-Supported revenue increased by €173 million or 10%.
This increase was due primarily to growth in music impressions sold which increased revenue in our direct and programmatic channels by €129 million. Ad sales from podcasts, partially offset by our self-serve platform, also increased by €64 million for the year ended December 31, 2023.
This increase was due primarily to growth in music impressions sold which increased revenue in our direct and programmatic channels as well as our self-serve platform by €114 million. Ad sales from podcasts, and growth in marketplace programs, also increased revenue by €58 million for the year ended December 31, 2024.
The rate of net growth in Premium Subscribers is also affected by our ability to retain our existing Premium Subscribers and the mix of subscription pricing plans. We have increased retention over time, as new features and functionality have led to increased user engagement and satisfaction.
The rate of net growth in Premium Subscribers is also affected by our ability to retain our existing Premium Subscribers and the mix of subscription pricing plans. New features and functionality have helped increase Premium Subscriber engagement over time.
Foreign exchange impact on total cost of revenue The general movement of the Euro relative to certain foreign currencies, primarily the U.S. dollar, for the year ended December 31, 2023, as compared to 2022, had a favorable net impact on our cost of revenue.
Foreign exchange impact on total cost of revenue The general movement of the Euro relative to certain foreign currencies, as well as movement in the Argentine Peso, for the year ended December 31, 2024, as compared to 2023, had a favorable net impact on our cost of revenue.
Foreign exchange impact on total revenue The general movement of the Euro relative to certain foreign currencies, primarily the U.S. dollar, for the year ended December 31, 2023, as compared to 2022, had an unfavorable net impact on our revenue.
Foreign exchange impact on total revenue The general movement of the Euro relative to certain foreign currencies, as well as movement in the Argentine Peso, for the year ended December 31, 2024, as compared to 2023, had an unfavorable net impact on our revenue.
We generally determine stand-alone selling prices based on the prices charged to customers; but where stand-alone selling prices are not directly observable, estimation techniques are used.
We generally determine stand-alone selling prices based on the prices charged to customers; but where stand-alone selling prices are not directly observable, estimation techniques are used which may include competitor pricing and other observable inputs.
Year ended December 31, Change 2023 2022 2021 2023 vs. 2022 2022 vs. 2021 (in € millions, except percentages) Finance income 161 421 246 (260) (62) % 175 71 % As a percentage of revenue 1 % 4 % 3 % For the year ended December 31, 2023, as compared to 2022, finance income decreased by €260 million.
Year ended December 31, Change 2024 2023 2022 2024 vs. 2023 2023 vs. 2022 (in € millions, except percentages) Finance income 328 161 421 167 104 % (260) (62) % As a percentage of revenue 2 % 1 % 4 % For the year ended December 31, 2024, as compared to 2023, finance income increased by €167 million.
Sales and marketing expenses primarily comprise employee compensation and benefits, public relations, branding, consulting expenses, customer acquisition costs, advertising, marketing events and trade shows, amortization of trade name intangible assets, the cost of working with music record labels, publishers, songwriters, and artists to promote the availability of new releases on our platform, and the costs of providing free trials.
Sales and marketing expenses primarily comprise employee compensation and benefits, public relations, branding, consulting expenses, customer acquisition costs, advertising, marketing events and trade shows, the cost of working with content creators and rights holders to promote the availability of new releases on our platform, and the costs of providing free trials.
(4) We are subject to various non-cancelable purchase obligations and service agreements with minimum spend commitments, including a service agreement with Google for the use of the Google Cloud Platform and certain podcast and marketing commitments.
(4) We are subject to various non-cancelable purchase obligations and service agreements with minimum spend commitments, including a service agreement with Google for the use of Google Cloud Platform and certain podcast and marketing commitments. C. Research and Development, Patents and Licenses For a detailed analysis of research and development policies and costs, see “Item 4.B.
Cost of revenue Year ended December 31, Change 2023 2022 2021 2023 vs. 2022 2022 vs. 2021 (in € millions, except percentages) Premium 8,231 7,355 5,986 876 12 % 1,369 23 % Ad-Supported 1,619 1,446 1,091 173 12 % 355 33 % Total 9,850 8,801 7,077 1,049 12 % 1,724 24 % Premium cost of revenue For the year ended December 31, 2023, as compared to 2022, Premium cost of revenue increased by €876 million, or 12%, and Premium cost of revenue as a percentage of Premium revenue decreased from 72% to 71%.
Cost of revenue Year ended December 31, Change 2024 2023 2022 2024 vs. 2023 2023 vs. 2022 (in € millions, except percentages) Premium 9,324 8,231 7,355 1,093 13 % 876 12 % Ad-Supported 1,625 1,619 1,446 6 — % 173 12 % Total 10,949 9,850 8,801 1,099 11 % 1,049 12 % Premium cost of revenue For the year ended December 31, 2024, as compared to 2023, Premium cost of revenue increased by €1,093 million, or 13%, and Premium cost of revenue as a percentage of Premium revenue decreased from 71% to 67%.
The lease terms are up to 10 years. See Note 11 to the consolidated financial statements included elsewhere in this report for further details regarding leases.
Lease obligations primarily relate to our office space and our subleased properties. The lease terms are up to 9 years. See Note 10 to the consolidated financial statements included elsewhere in this report for further details regarding leases.
Ad-Supported Our Ad-Supported Service has no subscription fees and generally provides Ad-Supported Users with limited on-demand online access to our catalog of music and unlimited online access to our catalog of podcasts on their computers, tablets, and compatible mobile devices. Ad-Supported Users can also purchase audiobooks on an à la carte basis in select markets.
Ad-Supported Our Ad-Supported Service has no subscription fees and generally provides Ad-Supported Users with limited on-demand online access to our catalog of music and unlimited online access to our catalog of podcasts on their computers, tablets, mobile devices, and other smart devices.
The Premium Service is primarily sold directly to end users. The Premium Service is also sold through partners who are generally telecommunications companies that bundle the subscription with their own services or collect payment for the stand-alone subscriptions from their end customers. Premium partner subscription revenue is based on a per-subscriber rate in a negotiated partner agreement.
We generate revenue for our Premium segment through the sale of subscriptions to the Subscription Offerings. The Subscription Offerings are primarily sold directly to end users. The Premium Service is also sold through partners who are generally telecommunications companies that bundle the subscription with their own services or collect payment for the stand-alone subscriptions from their end customers.
Gross profit and gross margin Year ended December 31, Change 2023 2022 2021 2023 vs. 2022 2022 vs. 2021 (in € millions, except percentages) Gross profit Premium 3,335 2,896 2,474 439 15 % 422 17 % Ad-Supported 62 30 117 32 107 % (87) (74) % Consolidated 3,397 2,926 2,591 471 16 % 335 13 % Gross margin Premium 29 % 28 % 29 % Ad-Supported 4 % 2 % 10 % Consolidated 26 % 25 % 27 % Premium gross profit and gross margin For the year ended December 31, 2023, as compared to 2022, Premium gross profit increased by €439 million and Premium gross margin increased from 28% to 29%.
Gross profit and gross margin Year ended December 31, Change 2024 2023 2022 2024 vs. 2023 2023 vs. 2022 (in € millions, except percentages) Gross profit Premium 4,495 3,335 2,896 1,160 35 % 439 15 % Ad-Supported 229 62 30 167 269 % 32 107 % Consolidated 4,724 3,397 2,926 1,327 39 % 471 16 % Gross margin Premium 33 % 29 % 28 % Ad-Supported 12 % 4 % 2 % Consolidated 30 % 26 % 25 % Premium gross profit and gross margin For the year ended December 31, 2024, as compared to 2023, Premium gross profit increased by €1,160 million and Premium gross margin increased from 29% to 33%.
For our Ad-Supported segment, typically we experience higher advertising revenue in the fourth quarter of each calendar year due to greater advertising demand during the holiday season. However, in the first quarter of each calendar year, we typically experience a seasonal decline in advertising revenue due to reduced advertiser demand.
However, in the first quarter of each calendar year, we typically experience a seasonal decline in advertising revenue due to reduced advertiser demand.
Our estimates are based on historical experience and various other assumptions that we believe to be reasonable under the circumstances. Our actual results may differ from these estimates. The critical accounting policies, estimates, assumptions, and judgments that we believe to have the most significant impact on our consolidated financial statements are described below.
Our estimates are based on historical experience and various other assumptions that we believe to be reasonable under the circumstances. Our actual results may differ from these estimates.
Amortization of podcast content assets is recorded in cost of revenue over the shorter of the estimated useful economic life or the license period, and begins at the release of each episode.
Amortization of podcast content assets is recorded in cost of revenue over the shorter of the estimated useful economic life or the license period, and begins at the release of each episode. The economic life and expected amortization profile of podcast content assets is estimated by management based on historical listening patterns and is evaluated on an ongoing basis.
Operating and Financial Review and Prospects, in our Annual Report on Form 20-F for the fiscal year ended December 31, 2022, which was filed with the SEC on February 2, 2023.
Operating and Financial Review and Prospects, in our Annual Report on Form 20-F for the fiscal year ended December 31, 2023, which was filed with the SEC on February 8, 2024. Overview We are the world’s most popular audio streaming subscription service.
Cost of revenue also includes credit card and payment processing fees for subscription revenue, advertising serving, advertising measurement, customer service, certain employee compensation and benefits, cloud computing, streaming, facility, and equipment costs. Research and Development .
We make payments to podcast publishers, whose content we monetize through advertising sales in SPAN, which are also included in cost of revenue. Cost of revenue also includes credit card and payment processing fees for subscription revenue, advertising serving, advertising measurement, customer service, certain employee compensation and benefits, cloud computing, streaming, facility, and equipment costs. Research and Development .
Exchangeable Notes On March 2, 2021, Spotify USA Inc. issued US $1,500 million in aggregate principal amount of the Exchangeable Notes. Net proceeds from the issuance of the Exchangeable Notes were €1,223 million after deducting transaction costs.
Exchangeable Notes On March 2, 2021, Spotify USA Inc. issued US $1,500 million in aggregate principal amount of the Exchangeable Notes. Net proceeds from the issuance of the Exchangeable Notes were €1,223 million after deducting transaction costs. See Note 18 to our consolidated financial statements included elsewhere in this report for further information regarding our Exchangeable Notes.
For the year ended December 31, 2023, as compared to 2022, Premium revenue increased by €1,315 million or 13%. The increase was due primarily to an increase in the number of Premium Subscribers, partially offset by a decrease in Premium ARPU of 3%, as noted above.
For the year ended December 31, 2024, as compared to 2023, Premium revenue increased by €2,253 million or 19%. The increase was due primarily to an increase in the number of Premium Subscribers and an increase in Premium ARPU of 7%, as noted above.
We believe our existing cash and cash equivalents, short term investments, and the cash flow we generate from our operations will be sufficient to meet our working capital and capital expenditure needs and other liquidity requirements for at least the next 12 months.
Cash and cash equivalents and short term investments increased by €3,234 million from €4,214 million as of December 31, 2023 to €7,448 million as of December 31, 2024. 47 Table of Contents We believe our existing cash and cash equivalents, short term investments, and the cash flow we generate from our operations will be sufficient to meet our working capital and capital expenditure needs and other liquidity requirements for at least the next 12 months.
Operating Results Revenue Year ended December 31, Change 2023 2022 2021 2023 vs. 2022 2022 vs. 2021 (in € millions, except percentages) Premium 11,566 10,251 8,460 1,315 13 % 1,791 21 % Ad-Supported 1,681 1,476 1,208 205 14 % 268 22 % Total 13,247 11,727 9,668 1,520 13 % 2,059 21 % Premium revenue For the years ended December 31, 2023 and 2022, Premium revenue comprised 87% of our total revenue.
Operating Results Revenue Year ended December 31, Change 2024 2023 2022 2024 vs. 2023 2023 vs. 2022 (in € millions, except percentages) Premium 13,819 11,566 10,251 2,253 19 % 1,315 13 % Ad-Supported 1,854 1,681 1,476 173 10 % 205 14 % Total 15,673 13,247 11,727 2,426 18 % 1,520 13 % Premium revenue For the years ended December 31, 2024 and 2023, Premium revenue comprised 88% and 87%, respectively, of our total revenue.
The increase in Premium cost of revenue was driven primarily by increases in Premium revenue and audiobook licensing costs, partially offset by benefits from certain marketplace programs. These collectively resulted in higher royalty costs of €814 million.
The increase in Premium cost of revenue was driven primarily by increases in Premium revenue driving increases in music royalties as well as an increase in audiobook licensing costs, partially offset by benefits from certain marketplace programs. These collectively resulted in higher royalty costs of €1,078 million. Additionally, there was an increase in payment processing fees of €40 million.
The increase was due primarily to an increase of €83 million attributable to an increase in the fair value of Exchangeable Notes.
The increase was due primarily to an increase in fair value movements on the Exchangeable Notes of €141 million and an increase in fair value movements on the warrants of €26 million.

… 116 more changes not shown on this page.

Item 6. [Reserved]

Selected Financial Data — reserved (removed by SEC in 2021)

134 edited+37 added−25 removed78 unchanged
This industry is characterized by rapidly changing market requirements and the emergence of new competitors. To succeed in this environment, we must continuously develop solutions that meet the needs of our rapidly growing user base in a rapidly changing environment, efficiently develop and refine new and existing products and services, and demonstrate a strong return on investment to our advertisers.
This industry is characterized by rapidly changing market requirements and the emergence of new competitors. To succeed in this environment, we must continuously develop solutions that meet the needs of our growing user base in a rapidly changing environment, efficiently develop and refine new and existing products and services, and demonstrate a strong return on investment to our advertisers.
Following the establishment of the initial compensation arrangements, our CEO, board of directors, and people experience and compensation committee have been responsible for overseeing our executive compensation program, as well as determining and approving the ongoing compensation arrangements for our CEO and other members of the executive leadership team, including the other named executive officers.
Following the establishment of the initial compensation arrangements, our CEO, board of directors, and people experience and compensation committee have been responsible for overseeing our executive compensation program, as well as determining and approving the ongoing compensation arrangements for members of the executive leadership team, including the other named executive officers.
The stock options generally vest as to 3/48ths of the total number of options granted on the third calendar month following the date of grant, and as to 1/48th of the total number of options granted on the first day of each calendar month thereafter, subject to continued employment.
The stock options generally vest as to 3/48ths of the total number of options granted on the first day of the third calendar month following the date of grant, and as to 1/48th of the total number of options granted on the first day of each calendar month thereafter, subject to continued employment.
The RSUs generally vest as to 3/48ths of the total number of RSUs granted on the third calendar month following the date of grant, and thereafter as to 1/48th of the total number of RSUs granted on the first day of each calendar month thereafter, subject to continued employment.
The RSUs generally vest as to 3/48ths of the total number of RSUs granted on the first day of the third calendar month following the date of grant, and thereafter as to 1/48th of the total number of RSUs granted on the first day of each calendar month thereafter, subject to continued employment.
She oversees all aspects of human resource management and is responsible for developing and executing the people strategy in support of our overall business plan. Ms. Berg serves as a member of the board of directors of Personio GmbH and as a member of the advisory board of Bambuser AB. Before joining our team, Ms.
She oversees all aspects of human resource management and is responsible for developing and executing the people strategy in support of our overall business plan. Ms. Berg serves as a member of the board of directors of Personio GmbH and Investor AB and as a member of the advisory board of Bambuser AB. Before joining our team, Ms.
Our people experience and compensation committee has the following responsibilities, among others: • reviewing and making recommendations to our board of directors related to our incentive-compensation plans and equity-based plans; • establishing and reviewing the overall compensation philosophy of the Company; • overseeing matters relating to the attraction, engagement, development, and retention of directors and employees, including executive officers; • reviewing and approving total compensation for our chief executive officer and other executive officers; • reviewing and making recommendations regarding the compensation to be paid to our non-employee directors; 67 Table of Contents • selecting and retaining a compensation consultant; • monitoring our diversity, inclusion, and belonging strategy; and • such other matters that are specifically delegated to the people experience and compensation committee by our board of directors from time to time.
Our people experience and compensation committee has the following responsibilities, among others: • reviewing and making recommendations to our board of directors related to our incentive-compensation plans and equity-based plans; 64 Table of Contents • establishing and reviewing the overall compensation philosophy of the Company; • overseeing matters relating to the attraction, engagement, development, and retention of directors and employees, including executive officers; • reviewing and approving total compensation for our chief executive officer and other executive officers; • reviewing and making recommendations regarding the compensation to be paid to our non-employee directors; • selecting and retaining a compensation consultant; • monitoring our diversity, inclusion, and belonging strategy; and • such other matters that are specifically delegated to the people experience and compensation committee by our board of directors from time to time.
There is no predetermined time of year for these reviews, although they are generally performed on an annual basis coinciding with our Company-wide employee compensation review in March.
There is no predetermined time of year for these reviews, although they are generally performed on an annual basis coinciding with our Company-wide employee compensation review beginning in March.
(2) Amounts reflect the grant-date fair value of the RSUs granted, computed in accordance with IFRS 2, rather than the amounts paid to or realized by the named individual.
(3) Amounts reflect the grant-date fair value of the RSUs granted, computed in accordance with IFRS 2, rather than the amounts paid to or realized by the named individual.
Overall, Compensia’s analysis of our Peer Group indicated that the target total cash compensation for our named executive officers was approximately the 25 th percentile of our Peer Group.
Overall, Compensia’s analysis of our Peer Group indicated that the target total cash compensation for our named executive officers was at approximately the 25 th percentile of our Peer Group.
He has been a member of our board of directors since June 13, 2017, and his term will expire on the date of the general meeting of shareholders to be held to approve the annual accounts of 2023. Mr. Mehrotra previously served as our Strategic Advisor to the Chief Executive Officer from December 2015 to May 2017. Mr.
He has been a member of our board of directors since June 13, 2017, and his term will expire on the date of the general meeting of shareholders to be held to approve the annual accounts of 2024. Mr. Mehrotra previously served as our Strategic Advisor to the Chief Executive Officer from December 2015 to May 2017. Mr.
He has been at Netflix since 2000. Thomas Staggs is a member of our board of directors. He has been a member of our board of directors since June 13, 2017, and his term will expire on the date of the general meeting of shareholders to be held to approve the annual accounts of 2023.
He has been at Netflix since 2000. Thomas Staggs is a member of our board of directors. He has been a member of our board of directors since June 13, 2017, and his term will expire on the date of the general meeting of shareholders to be held to approve the annual accounts of 2024.
The business address of Rivers Cross Trust is 3875 Woodside Rd, Woodside, CA 94062. (5) Includes 23,094 ordinary shares held by the Staggs Trust, a revocable inter-vivos trust established by Mr. Staggs and his spouse. The business address of the Staggs Trust is 9200 Sunset Blvd, Los Angeles, CA 90069.
The business address of Rivers Cross Trust is 3875 Woodside Rd, Woodside, CA 94062. (6) Includes 23,094 ordinary shares held by the Staggs Trust, a revocable inter-vivos trust established by Mr. Staggs and his spouse. The business address of the Staggs Trust is 9200 Sunset Blvd, Los Angeles, CA 90069.
Our total compensation for our named executive officers other than our CEO (who, as we note below, did not receive any cash or equity compensation in 2023), including cash and equity compensation, was between the 50 th and 75 th percentile of our Peer Group.
Our total compensation for our named executive officers other than our CEO (who, as we note below, did not receive any cash or equity compensation in 2024), including cash and equity compensation, was between the 50 th and 75 th percentile of our Peer Group.
He has been a member of our board of directors since June 16, 2015, and his term will expire on the date of the general meeting of shareholders to be held to approve the annual accounts of 2023. In addition to his role on our board of directors, Mr.
He has been a member of our board of directors since June 16, 2015, and his term will expire on the date of the general meeting of shareholders to be held to approve the annual accounts of 2024. In addition to his role on our board of directors, Mr.
Although we consider these personal security services to be appropriate and necessary for the reasons described above, the costs related to such services are reported as other compensation to our named executive officers in the “2023 Summary Compensation Table” below.
Although we consider these personal security services to be appropriate and necessary for the reasons described above, the costs related to such services are reported as other compensation to our named executive officers in the “2024 Summary Compensation Table” below.
She has been a member of our board of directors since April 21, 2021, and her term will expire on the date of the general meeting of shareholders to be held to approve the annual accounts of 2023.
She has been a member of our board of directors since April 21, 2021, and her term will expire on the date of the general meeting of shareholders to be held to approve the annual accounts of 2024.
(3) Amounts reflect the aggregate grant-date Black-Scholes value of the stock options granted during 2023 computed in accordance IFRS 2, rather than the amounts paid to or realized by the named individual.
(3) Amounts reflect the aggregate grant-date Black-Scholes value of the stock options granted during 2024 computed in accordance IFRS 2, rather than the amounts paid to or realized by the named individual.
We provide information regarding the assumptions used to calculate the value of all stock awards made in “Operating and Financial Review and Prospects” and in Note 18 of the consolidated financial statements included elsewhere in this report.
We provide information regarding the assumptions used to calculate the value of all stock awards made in “Operating and Financial Review and Prospects” and in Note 17 of the consolidated financial statements included elsewhere in this report.
Berg held human resources roles in various multinational companies, such as Swedbank, 3 Scandinavia, and Kanal 5 (SBS Broadcasting). Ms. Berg holds a Master of Arts in Human Resources Management and Development in Behavioral Science from Lund University. 58 Table of Contents Dustee Jenkins is our Chief Public Affairs Officer.
Berg held human resources roles in various multinational companies, such as Swedbank, 3 Scandinavia, and Kanal 5 (SBS Broadcasting). Ms. Berg holds a Master of Arts in Human Resources Management and Development in Behavioral Science from Lund University. Dustee Jenkins is our Chief Public Affairs Officer.
In 2023, Compensia provided the people experience and compensation committee with total cash compensation data and total compensation data (including cash compensation and equity compensation) at various percentiles within the Peer Group.
In 2024, Compensia provided the people experience and compensation committee with total cash compensation data and total compensation data (including cash compensation and equity compensation) at various percentiles within the Peer Group.
During the portion of 2023 during which Mr. Norström resided in the U.K., Mr. Norström was not eligible to participate in the Swedish occupational pension plan, and he did not elect to participate in our pension plan for U.K.-based employees during this period. For our employees in the United States who satisfy certain eligibility requirements, including Mr. Vogel and Ms.
During the portion of 2024 during which Mr. Norström resided in the U.K., Mr. Norström was not eligible to participate in the Swedish occupational pension plan, and he did not elect to participate in our pension plan for U.K.-based employees during this period. For our employees in the United States who satisfy certain eligibility requirements, including Mr.
He also has served as a member of the board of directors of Pandora from 2011 to 2013 (Chairman of the audit committee), Eventbrite from 2011 to 2015, Chegg from 2010 to 2015 (Chairman of the audit committee), and MSD Acquisition Corp. from 2021 to 2022 (Chairman of the audit committee). From 2011 to 2022, Mr.
He also has served as a member of the board of directors of Instacart from 2021 to 2024 (Chairman of the audit committee), Pandora from 2011 to 2013 (Chairman of the audit committee), Eventbrite from 2011 to 2015, Chegg from 2010 to 2015 (Chairman of the audit committee), and MSD Acquisition Corp. from 2021 to 2022 (Chairman of the audit committee).
In addition, the personal safety of our employees, including our named executive officers, is of the highest importance to us and in 2023 we paid for personal security services for certain named executive officers pursuant to the Company's personal security program for senior management.
In addition, the personal safety of our employees, including our named executive officers, is of the highest importance to us and in 2024 we paid for personal security services, including home security services, for certain named executive officers pursuant to the Company’s personal security program for senior management.
(2) Amounts of option awards reflect the grant-date Black-Scholes value of the stock options granted during 2023 computed in accordance IFRS 2, rather than the amounts paid to or realized by the named individual.
(3) Amounts of option awards reflect the grant-date Black-Scholes value of the stock options granted during 2024 computed in accordance IFRS 2, rather than the amounts paid to or realized by the named individual.
Since July 1, 2017, our CEO has not been awarded any compensation, but from time to time he has been provided with the opportunity to purchase non-compensatory warrants at fair market value through D.G.E.
Since July 1, 2017, our CEO has not been awarded any compensation, but from time to time he 58 Table of Contents has been provided with the opportunity to purchase non-compensatory warrants at fair market value through D.G.E.
He has been a member of our board of directors since January 8, 2020, and his term will expire on the date of the general meeting of shareholders to be held to approve the annual accounts of 2023. Mr. McCarthy previously served as our Chief Financial Officer from 2015 to January 2020.
He has been a member of our board of directors since January 8, 2020, and his term will expire on the date of the general meeting of shareholders to be held to approve the annual accounts of 2024. Mr. McCarthy previously served as our Chief Financial Officer from 2015 to January 2020. Prior to joining Spotify, Mr.
We provide information regarding the assumptions used to calculate 72 Table of Contents the value of all option awards made to executive officers in “Operating and Financial Review and Prospects” and in Note 18 of the consolidated financial statements included elsewhere in this report.
We provide information regarding the assumptions used to calculate 69 Table of Contents the value of all option awards made to executive officers in “Operating and Financial Review and Prospects” and in Note 17 of the consolidated financial statements included elsewhere in this report.
The options generally expire on the fifth anniversary of the date of grant, and vested options may be exercised at any time prior to the expiration of the option term.
The options generally expire on the fifth anniversary of the date of grant, and vested options may be exercised at any time prior to 67 Table of Contents the expiration of the option term.
Holding is 1 Alexandrou Panagouli, Office 2B, Novel Tower, 6057 Larnaca, Cyprus. (2) Includes 21,469,762 ordinary shares held by Rosello Company Limited (“Rosello”). Mr. Lorentzon is the sole shareholder of Amaltea S.à r.l. (“Amaltea”), which is the sole shareholder of Rosello. As such, each of Amaltea and Mr.
Holding is 1 Alexandrou Panagouli, Office 2B, Novel Tower, 6057 Larnaca, Cyprus. (2) Includes 20,000,000 ordinary shares held by Rosello Company Limited (“Rosello”). Mr. Lorentzon is the sole shareholder of Amaltea S.à r.l. (“Amaltea”), which is the sole shareholder of Rosello. As such, each of Amaltea and Mr.
Jenkins will not be entitled to the severance described above, in the event of certain asset sales where the executive continues his or her employment in the same or greater capacity following the transaction or the executive is offered continued employment in connection with the transaction and the executive’s employment agreement is assumed by the surviving entity following the transaction.
Jenkins will not be entitled to the severance described above in the event of certain asset sales where she continues her employment in the same or greater capacity following the transaction or she is offered continued employment in connection with the transaction and her employment agreement is assumed by the surviving entity following the transaction. Ms.
Discovery Zalando 62 Table of Contents The people experience and compensation committee bases its executive compensation decisions, at least in part, by reference to the compensation of the executives holding comparable positions at this group of comparable peer companies, as it may be adjusted from time to time.
The people experience and compensation committee bases its executive compensation decisions, at least in part, by reference to the compensation of the executives holding comparable positions at this group of comparable peer companies, as it may be adjusted from time to time.
Severance Each of our named executive officers is entitled to severance upon certain qualifying terminations. For further information on such amounts please see “—Employment Agreements” below. Executive Transition As previously announced, Mr. Vogel, the Company’s Chief Financial Officer, will cease employment with the Company on March 31, 2024. In connection with his departure, Mr.
Severance Each of our named executive officers is entitled to severance upon certain qualifying terminations. For further information on such amounts please see “—Employment Agreements” below. 62 Table of Contents CFO Transition As previously announced, Mr. Vogel, the Company’s Chief Financial Officer, ceased employment with the Company on March 31, 2024. In connection with his departure, Mr.
He also serves as chairman of the board of trustees for the Academy Museum of Motion Pictures and the Treasurer for the board of directors of Exploring the Arts.
Sarandos serves on the board of directors of Netflix. He also serves as chairman of the board of trustees for the Academy Museum of Motion Pictures and the Treasurer for the board of directors of Exploring the Arts.
The Management Members disclaim beneficial ownership of the ordinary shares and the ordinary shares issuable upon vesting of non-qualified stock options and RSUs, except to the extent of their respective pecuniary interest therein. (4) Includes 381,797 ordinary shares held by Rivers Cross Trust, an entity wholly owned by Mr. McCarthy.
The Management Members disclaim beneficial ownership of the ordinary shares and the ordinary shares issuable upon vesting of non-qualified stock options and RSUs, except to the extent of their respective pecuniary interest therein. (5) Includes 376,297 ordinary shares held by Rivers Cross Trust, an entity wholly owned by Mr. McCarthy.
In 2022, the people experience and compensation committee approved the compensation peer group (the “Peer Group”) for fiscal year 2023. The Peer Group for 2023 consisted of the following companies: Activision Blizzard Autodesk Block Booking Holdings eBay Electronic Arts Expedia Group IAC/InterActiveCorp Intuit MercadoLibre Netflix PayPal Holdings Sirius XM Holdings Snap Take-Two Interactive Twitter Uber Technologies Warner Bros.
In 2023, the people experience and compensation committee approved the compensation peer group (the “Peer Group”) for fiscal year 2024. The Peer Group for 2024 consisted of the following companies: Activision Blizzard Airbnb Autodesk Block Booking Holdings DoorDash eBay Electronic Arts Expedia Group Intuit MercadoLibre Netflix PayPal Holdings Sirius XM Holdings Snap Take-Two Interactive Uber Technologies Warner Bros.
She has been a member of our board of directors since June 13, 2017, and her term will expire on the date of the general meeting of shareholders to be held to approve the annual accounts of 2023. Ms.
She has been a member of our board of directors since June 13, 2017, and her term will expire on the date of the general meeting of shareholders to be held to approve the annual accounts of 2024. In addition to her role on our board of directors, Ms.
We provide information regarding the assumptions used to calculate the value of all stock awards made to executive officers in “Operating and Financial Review and Prospects” and in Note 18 of the consolidated financial statements included elsewhere in this report. (3) Amount reflects the cash award granted to Ms.
We provide information regarding the assumptions used to calculate the value of all stock awards made to executive officers in “Operating and Financial Review and Prospects” and in Note 17 of the consolidated financial statements included elsewhere in this report. (4) Amount reflects the cash award granted to Mr. Luiga and Ms.
He has been a member of our board of directors since September 13, 2016, and his term will expire on the date of the general meeting of shareholders to be held to approve the annual accounts of 2023. In addition to his role on our board of directors, Mr. Sarandos serves on the board of directors of Netflix.
Ted Sarandos is a member of our board of directors. He has been a member of our board of directors since September 13, 2016, and his term will expire on the date of the general meeting of shareholders to be held to approve the annual accounts of 2024. In addition to his role on our board of directors, Mr.
We provide information regarding the assumptions used to calculate the value of all option awards made to executive officers in “Operating and Financial Review and Prospects” and in Note 18 of the consolidated financial statements included elsewhere in this report. (3) Amount reflects the cash award granted to Ms.
We provide information regarding the assumptions used to calculate the value of all option awards made to executive officers in “Operating and Financial Review and Prospects” and in Note 17 of the consolidated financial statements included elsewhere in this report. (4) Amount reflects the cash award granted to Mr.
(“Compensia”), a compensation consulting firm, competitive pay practices for comparable positions at companies of comparable scale and in relevant business segments, as further described below, and the experience of the members of the people experience and compensation committee with other companies; • the length of service of an individual; and • the compensation levels of other members of the executive leadership team, each as of the time of the applicable compensation decision.
(“Compensia”), our people experience and compensation committee’s independent compensation consultant, competitive pay practices for comparable positions at companies of comparable scale and in relevant business segments, as further described below, and the experience of the members of the people experience and compensation committee with other companies; • the length of service of an individual; and • the compensation levels of other members of the executive leadership team, each as of the time of the applicable compensation decision.
(now Hill+Knowlton Strategies) specializing in crisis and financial transactions, the director of communications of the Department of Housing and Urban Development as an appointee of President George W. Bush, and Press Secretary for U.S. Senator Kay Bailey Hutchison. Ms. Jenkins also serves on the board of directors of Tech:NYC. Eve Konstan is our General Counsel.
(now Hill+Knowlton Strategies) specializing in crisis and financial transactions, the director of communications of the Department of Housing and Urban Development as an appointee of President George W. Bush, and Press Secretary for U.S. Senator Kay Bailey Hutchison. Ms. Jenkins also serves on the board of directors of Tech:NYC. Christian Luiga is our Chief Financial Officer.
Jenkins as part of our incentive mix program. 3/48ths of the cash award vested on the third calendar month following the date of grant, and 1/48th of the cash award granted vests on the first day of each calendar month thereafter, subject to continued employment. (4) As of July 1, 2017, we ceased paying Mr.
Jenkins as part of our incentive mix program. 3/48ths of the cash awards vested on the third calendar month following the date of grant, and 1/48th of the cash award granted vests on the first day of each calendar month thereafter, subject to continued employment. (5) Since July 1, 2017, Mr.
Ek’s retirement, which shall be at age of 65, and a fixed monthly salary (although the board of directors determined that, commencing July 1, 2017, Mr. Ek would no longer receive an annual salary). The employment agreement further entitles Mr.
Ek’s employment agreement provides for an indefinite term that automatically expires upon Mr. Ek’s retirement, which shall be at age of 65, and a fixed monthly salary (although the board of directors determined that, commencing July 1, 2017, Mr. Ek would no longer receive an annual salary). The employment agreement further entitles Mr.
The principles and objectives of our compensation and benefits programs for our executive leadership team and other employees are to: • attract, engage, and retain the best executives to work for us, with experience and managerial talent enabling us to be an employer of choice in highly competitive and dynamic industries; • align compensation with our corporate strategies, business and financial objectives, and the long-term interests of our shareholders; • motivate and reward executives whose knowledge, skills, and performance ensure our continued success; and • ensure that our total compensation is fair, reasonable, and competitive. 61 Table of Contents We compete with many other companies in seeking to attract and retain experienced and skilled executives.
The principles and objectives of our compensation and benefits programs for our executive leadership team and other employees are to: • attract, engage, and retain the best executives to work for us, with experience and managerial talent that enables us to be an employer of choice in highly competitive and dynamic industries; • align compensation with our corporate strategies, business and financial objectives, and the long-term interests of our shareholders; • motivate and reward executives whose knowledge, skills, and performance ensure our continued success; and • ensure that our total compensation is fair, reasonable, and competitive.
The plans provide for certain potential adjustments in the event of corporate transactions. Each year, our people experience and compensation committee reviews and, if needed, recommends updates regarding non-employee director compensation to our board of directors. In addition, our equity program for our board of directors is subject to shareholder approval.
The plans provide for certain potential adjustments in the event of corporate transactions. Each year, our people experience and compensation committee reviews and, if needed, recommends updates regarding non-employee director compensation to our board of directors.
In 2003, Mr. Söderström founded Kenet Works, a company that developed community software for mobile phones and served as the company’s Chief Executive Officer until it was acquired by Yahoo! in 2006. Mr. Söderström holds a Master of Science in Electrical Engineering from KTH Royal Institute of Technology. Paul Vogel is our Chief Financial Officer.
Söderström founded Kenet Works, a company that developed community software for mobile phones and served as the company’s Chief Executive Officer until it was acquired by Yahoo! in 2006. Mr. Söderström holds a Master of Science in Electrical Engineering from KTH Royal Institute of Technology. Christopher (Woody) Marshall is a member of our board of directors.
Heidi O’Neill is a member of our board of directors. She has been a member of our board of directors since December 5, 2017, and her term will expire on the date of the general meeting of shareholders to be held to approve the annual accounts of 2023. In addition to her role on our board of directors, Ms.
She has been a member of our board of directors since December 5, 2017, and her term will expire on the date of the general meeting of shareholders to be held to approve the annual accounts of 2024. In addition to her role on our board of directors, Ms. O’Neill serves on the board of directors of Hyatt Hotels Corp.
Sutphen was a managing director at UBS AG, where she developed new tools for political risk evaluation impacting capital markets. From 2009 to 2011, she served as White House Deputy Chief of Staff for Policy for President Barack Obama, advancing the administration’s policy and regulatory agenda. She also served on the President’s Intelligence Advisory Board. Ms.
Sutphen was a managing director at UBS AG, where she developed new tools for political risk evaluation impacting capital 56 Table of Contents markets. From 2009 to 2011, she served as White House Deputy Chief of Staff for Policy for President Barack Obama, advancing the administration’s policy and regulatory agenda.
Norström related to the vesting of such RSUs. Non-Employee Director Compensation Similarly to our executive compensation decisions, the people experience and compensation committee bases its decisions regarding non-employee director compensation, at least in part, by reference to the compensation of the non-employee directors in the Peer Group (as described above in “—Engagement of Compensation Consultant”).
Non-Employee Director Compensation Similar to our executive compensation decisions, the people experience and compensation committee bases its decisions regarding non-employee director compensation, at least in part, by reference to the compensation of the non-employee directors in the Peer Group (as described above in “—Engagement of Compensation Consultant”).
(1) Includes 13,424,407 ordinary shares held by D.G.E. Investments Limited (“D.G.E. Investments”). Mr. Ek is the sole shareholder of D.G.E. Holding Limited (“D.G.E. Holding”), which is the sole shareholder of D.G.E. Investments.
(1) Includes 12,473,298 ordinary shares held by D.G.E. Investments Limited (“D.G.E. Investments”). Mr. Ek is the sole shareholder of D.G.E. Holding Limited (“D.G.E. Holding”), which is the sole shareholder of D.G.E. Investments.
Retirement Savings and Other Benefits Our retirement programs are designed to comply with local laws and regulations. For our employees who reside in Sweden, including Mr. Söderström (and, for a portion of 2023, Mr. Norström), we participate in an occupational pension plan.
Retirement Savings and Other Benefits Our retirement programs are designed to comply with local laws and regulations. For our employees who reside in Sweden, including Messrs. Luiga and Söderström (and, for a portion of the year following his return to Sweden in August 2024, Mr. Norström), we participate in an occupational pension plan.
The following table describes our average number of employees by department per fiscal year: December 31, % Change 2023 2022 2021 2023 vs. 2022 2022 vs. 2021 Content Production and Customer Service 663 785 705 (16) % 11 % Sales and Marketing 2,403 2,043 1,654 18 % 24 % Research and Development 4,719 4,169 3,175 13 % 31 % General and Administrative 1,338 1,362 1,083 (2) % 26 % 68 Table of Contents The following table describes our average number of employees by geographic location: December 31, 2023 2022 2021 United States 4,574 4,332 3,435 Sweden 1,706 1,853 1,845 United Kingdom 1,048 881 576 Additionally, for the years ended December 31, 2023, 2022, and 2021, we had an average of approximately 1,795, 1,294, and 761 employees and contractors, respectively, in the aggregate in Australia, Argentina, Belgium, Brazil, Canada, Denmark, Finland, France, Germany, India, Ireland, Italy, Japan, Luxembourg, Mexico, Netherlands, Singapore, South Africa, South Korea, Spain, Switzerland, Taiwan, Türkiye, and United Arab Emirates.
The following table describes our average number of employees by department per fiscal year: December 31, % Change 2024 2023 2022 2024 vs. 2023 2023 vs. 2022 Content Production and Customer Service 502 663 785 (24) % (16) % Sales and Marketing 2,177 2,403 2,043 (9) % 18 % Research and Development 3,944 4,719 4,169 (16) % 13 % General and Administrative 1,068 1,338 1,362 (20) % (2) % 65 Table of Contents The following table describes our average number of employees by geographic location: December 31, 2024 2023 2022 United States 3,690 4,574 4,332 Sweden 1,397 1,706 1,853 United Kingdom 874 1,048 881 Additionally, for the years ended December 31, 2024, 2023, and 2022, we had an average of approximately 1,730, 1,795, and 1,294 employees and contractors, respectively, in the aggregate in Argentina, Australia, Belgium, Brazil, Canada, Denmark, Finland, France, Germany, India, Indonesia, Ireland, Italy, Japan, Luxembourg, Mexico, Netherlands, Singapore, South Africa, South Korea, Spain, Taiwan, and United Arab Emirates.
Ek has not received a base salary. (2) Mr. Norström was paid in Swedish krona and British pound. Such amounts are based on the exchange rate of SEK 10.08 per dollar and GBP 0.79 per dollar as of December 31, 2023 as published by Reuters. (3) Mr. Söderström was paid in Swedish krona.
Ek has not received a base salary. (2) Mr. Luiga was paid in Swedish krona. Such amounts are based on the exchange rate of SEK 11.07 per dollar as of December 31, 2024 as published by Reuters. (3) Mr. Norström was paid in Swedish krona and British pound.
(4) Includes 3,618 RSUs which the Company retained as part of a net share settlement to satisfy the applicable tax withholding liability of Ms. Jenkins related to the vesting of such RSUs. (5) Includes 11,205 RSUs which the Company retained as part of a net share settlement to satisfy the applicable tax withholding liability of Mr.
Vogel related to the vesting of such RSUs. (5) Includes 5,500 RSUs which the Company retained as part of a net share settlement to satisfy the applicable tax withholding liability of Ms. Jenkins related to the vesting of such RSUs.
Each of the key elements of our executive compensation program is discussed in more detail below. Our compensation programs are designed to be flexible and complementary and to collectively serve their principles and objectives. Executive Compensation Philosophy and Objectives We operate in the highly competitive and dynamic digital media industry as the world’s most popular global audio streaming subscription service.
Our compensation programs are designed to be flexible and complementary and to collectively serve their principles and objectives. 57 Table of Contents Executive Compensation Philosophy and Objectives We operate in the highly competitive and dynamic digital media industry as the world’s most popular global audio streaming subscription service.
The 2023 dollar amounts are based on a currency translation of SEK 10.08 per dollar as published by Reuters on December 31, 2023. The amounts include vacation pay received by Messrs. Söderström and Norström pursuant to Swedish standards. Additionally, for a portion of 2023, Mr. Norström was paid in British pound.
Söderström and Norström pursuant to Swedish standards. Additionally, for a portion of 2023 and 2024, Mr. Norström was paid in British pound. The 2023 dollar amounts are based on a currency translation of GBP 0.79 per dollar as published by Reuters on December 31, 2023.
In addition, upon a termination without Cause, subject to the named executive officer’s execution and non-revocation of a release of claims, Messrs. Norström, Söderström, and Vogel, and Ms. Jenkins would each be entitled to a severance amount equal to the executive’s respective base salary for six months (or, for Ms.
In addition, upon a termination without Cause, subject to the executive’s execution and non-revocation of a release of claims, each executive would be entitled to a severance amount equal to the executive’s respective base salary for six months.
On July 1, 2022, 800,000 warrants that were granted on July 1, 2019 expired unexercised. On August 23, 2021, Mr. Ek purchased, through D.G.E. Investments, 800,000 non-compensatory warrants in the Company, pursuant to a subscription agreement. Each warrant was purchased for $46.01, the then-current fair market value per share. The terms and conditions for the warrants provide that D.G.E.
Warrants On July 1, 2019, Mr. Ek purchased, through D.G.E. Investments, 800,000 non-compensatory warrants in the Company, pursuant to a subscription agreement. Each warrant was purchased for $20.61, the then-current fair market value per share. The terms and conditions for the warrants provided that D.G.E.
D. Employees In 2023, 2022, and 2021, we had 9,123, 8,359, and 6,617 full-time employees on average, respectively.
D. Employees In 2024, 2023, and 2022, we had 7,691, 9,123, and 8,359 full-time employees on average, respectively.
Norström, Söderström or Vogel is required to perform duties that are materially inconsistent with those normally performed by the executive, or if the executive is otherwise constructively dismissed following the change in control, subject to the named executive officer’s execution and non-revocation of a release of claims, the named executive officer would be entitled to receive a lump sum severance payment of 12 months’ salary and subsidized health benefits.
Luiga’s, Norström’s or Söderström’s employment is terminated within 12 months after a change in control of the Company, if the executive is required to perform duties that are materially inconsistent with those normally performed by the executive, or if the executive is otherwise constructively dismissed following the change in control, subject to the executive’s execution and non-revocation of a release of claims, the executive would be entitled to receive a lump sum severance payment of 12 months’ salary.
These 2023 dollar amounts are based on a currency translation of SEK 10.08 per dollar as published by Reuters on December 31, 2023. (9) Messrs. Söderström and Norström were each paid in Swedish krona in 2021, 2022, and 2023.
Söderström and Norström were each paid in Swedish krona in 2022, 2023, and 2024. Mr. Luiga was paid in Swedish krona in 2024.The 2022 dollar amounts are based on a currency translation of SEK 9.60 per dollar as published by Reuters on December 31, 2022.
None of our other senior management, directors, or key employees has any arrangement or understanding with our principal shareholder, customers, suppliers, or other persons pursuant to which such senior management, director, or key employee was selected as such. B.
Arrangements or Understandings None of our senior management or directors has any arrangement or understanding with our major shareholders, customers, suppliers, or other persons pursuant to which such senior management or director was selected as such. B.
(2) Values were calculated based on a $187.91 closing price of our ordinary shares, as reported on the New York Stock Exchange (the "NYSE") on December 31, 2023.
(2) Values were calculated based on a $447.38 closing price of our ordinary shares, as reported on the New York Stock Exchange (the “NYSE”) on December 31, 2024.
Compensation This section discusses the principles underlying the material components of our executive compensation program for a subset of our executive leadership team who would be our named executive officers, if we were a domestic issuer, and the factors relevant to an analysis of these policies and decisions.
Compensation This section discusses the principles underlying the material components of our executive compensation program for a subset of our executive leadership team, who we refer to as our “named executive officers,” and the factors relevant to an analysis of these policies and decisions.
Directors and Senior Management The following table sets forth the names, ages, and positions of our senior management and directors as of the date of this report: Name Age Position Daniel Ek 40 Founder, Chief Executive Officer, Chairman, and Director Martin Lorentzon 54 Co-Founder and Director Katarina Berg 55 Chief Human Resources Officer Dustee Jenkins 45 Chief Public Affairs Officer Eve Konstan 55 General Counsel Alex Norström 47 Co-President, Chief Business Officer Gustav Söderström 47 Co-President, Chief Product & Technology Officer Paul Vogel (1) 50 Chief Financial Officer Christopher Marshall 55 Lead Independent Director Barry McCarthy 70 Director Shishir Mehrotra 44 Director Heidi O’Neill 59 Director Ted Sarandos 59 Director Thomas Staggs 63 Director Mona Sutphen 56 Director Padmasree Warrior 63 Director ______________________ (1) As previously announced, Mr.
Directors and Senior Management The following table sets forth the names, ages, and positions of our senior management and directors as of the date of this report: Name Age Position Daniel Ek 41 Founder, Chief Executive Officer, Chairman, and Director Martin Lorentzon 55 Co-Founder and Director Katarina Berg (1) 56 Chief Human Resources Officer Dustee Jenkins 46 Chief Public Affairs Officer Christian Luiga 56 Chief Financial Officer Alex Norström 48 Co-President, Chief Business Officer Gustav Söderström 48 Co-President, Chief Product & Technology Officer Christopher Marshall 56 Lead Independent Director Barry McCarthy 71 Director Shishir Mehrotra 45 Director Heidi O’Neill 60 Director Ted Sarandos 60 Director Thomas Staggs 64 Director Mona Sutphen 57 Director Padmasree Warrior 64 Director ______________________ (1) Ms.
O'Neill serves on the board of directors of Hyatt Hotels Corp. She previously served as a member of the board of directors of Skullcandy, where she also was the Chair of the compensation committee, and the Nike School Innovation Fund, of which she was a founding member. Ms.
She previously served as a member of the board of directors of Skullcandy, where she also was the Chair of the compensation committee, and the Nike School Innovation Fund, of which she was a founding member. Ms. O’Neill also serves as the President of Consumer, Product and Brand, a division of Nike, Inc.
Vogel will leave the Company on March 31, 2024. The business address of each director and each of Mr. Ek, Ms. Berg, and Mr. Söderström is Regeringsgatan 19, 111 53 Stockholm, Sweden. The business address of each of Ms. Jenkins, Ms. Konstan, and Mr. Vogel is 150 Greenwich Street, 63rd Floor, New York, New York 10007.
Berg notified the Company that she will resign from the Company effective on March 31, 2025. The business address of each director and each of Mr. Ek, Ms. Berg, Mr. Luiga, Mr. Norström, and Mr. Söderström is Regeringsgatan 19, 111 53 Stockholm, Sweden. The business address of Ms. Jenkins is 150 Greenwich Street, 63rd Floor, New York, New York 10007.
He is responsible for our global product and technology strategy, overseeing the product, design, data, and engineering teams at the Company. Mr. Söderström is a startup seed investor and founder of 13th Lab (acquired by Facebook’s Oculus). Before joining the Company in 2009, Mr. Söderström was director of product and business development for Yahoo! Mobile from 2006 to 2009.
Söderström is a startup seed investor and founder of 13th Lab (acquired by Facebook’s Oculus). Before joining the Company in 2009, Mr. Söderström was director of product and business development for Yahoo! Mobile from 2006 to 2009. In 2003, Mr.
Marshall and the other members of TCV VII Management and TCV VIII Management (collectively, the “Management Members”) may be deemed to have the shared power to dispose or 70 Table of Contents direct the disposition of the 18,496 ordinary shares, the 18,708 unvested non-qualified stock options, and the 25,421 vested non-qualified stock options held by Mr. Marshall.
Marshall and the other members of TCV VIII Management and TCV XI Management (collectively, the “Management Members”) may be deemed to have the shared power to dispose or direct the disposition of the 1,380 ordinary shares, the 11,164 unvested non-qualified stock options, and the 11,496 vested non-qualified stock options held by Mr. Marshall.
He has been a member of our board of directors since July 21, 2008, and his term will expire on the date of the general meeting of shareholders to be held to approve the annual accounts of 2023. Mr. Lorentzon previously served as Chairman of our board of directors from 2008 to 2016.
Martin Lorentzon is our co-founder and a member of our board of directors. He has been a member of our board of directors since July 21, 2008, and his term will expire on the date of the general meeting of shareholders to be held to approve the annual accounts of 2024. Mr.
(2) Amounts reflect the grant-date fair value of the RSUs granted computed in accordance with IFRS 2, rather than the amounts paid to or realized by the named individual.
(2) Amounts reflect the grant-date Black-Scholes value of the stock options granted to our named executive officers, computed in accordance with IFRS 2, rather than the amounts paid to or realized by the named individual.
Long-Term Incentives Each of our named executive officers has been granted equity awards in the Company, which allow them to share in the future appreciation of the Company, subject to certain vesting conditions, as described in more detail below.
The vested retention bonus was paid in the pay period following the vesting date. Long-Term Incentives Each of our named executive officers, other than Mr. Ek, has been granted equity awards in the Company, which allow them to share in the future appreciation of the Company, subject to certain vesting conditions, as described in more detail below.
In addition, for certain employees, including the named executive officers, if in connection with or within six months following a change in control, the individual (i) resigns because he or she is required to perform duties that are materially inconsistent with the ones normally performed by someone in such position or (ii) otherwise experiences a constructive termination, all of the individual’s outstanding unvested RSUs will accelerate and vest. 71 Table of Contents For our employees in certain countries, upon vesting of an RSU, the Company is required to pay a social security contribution in an amount equal to the profit an employee realizes upon vesting multiplied by the applicable tax rate.
In addition, for certain employees, including the named executive officers, if in connection with or within six months following a change in control, the individual (i) resigns because he or she is required to perform duties that are materially inconsistent with the ones normally performed by someone in such position or (ii) otherwise experiences a constructive termination, all of the individual’s outstanding unvested RSUs will accelerate and vest.
Jenkins, we have established a 401(k) retirement savings plan. Under the 401(k) plan, eligible employees may elect to reduce their current compensation by up to the prescribed annual limit and contribute these amounts to the 401(k) plan. The Company matches up to 50% of the employee’s contributions up to 6% of their eligible compensation.
Vogel (prior to his departure) and Ms. Jenkins, we have established a 401(k) retirement savings plan. Under the 401(k) plan, eligible employees may elect to reduce their current compensation by up to the prescribed annual limit and contribute these amounts to the 401(k) plan.
Ek) was granted a cash retention bonus in the amount set forth below: Named Executive Officer Retention Bonus ($) Daniel Ek $ — Paul Vogel $ 691,200 Dustee Jenkins $ 571,895 Alex Norström $ 1,664,000 Gustav Söderström $ 1,664,000 The retention bonuses will vest in full on the 12-month anniversary of the grant date (i.e., March 1, 2024), subject to the executive’s continued full-time employment (and the executive not providing or receiving notice of termination of employment) through such vesting date.
Ek) was granted a cash retention bonus in the amount set forth below: Named Executive Officer Retention Bonus ($) Daniel Ek $ — Paul Vogel $ 691,200 Dustee Jenkins $ 571,895 Alex Norström $ 1,664,000 Gustav Söderström $ 1,664,000 The retention bonuses vested in full on the 12-month anniversary of the grant date (i.e., March 1, 2024).
For further information on our equity award programs, please see “—Stock Options,” “—Restricted Stock Units” and “—Cash Program” below. In 2023, each of our named executive officers, other than Mr. Ek, participated in the incentive mix program.
For further information on our equity award programs, please see “—Stock Options,” “—Restricted Stock Units” and “—Cash Program” below. In 2024, each of our named executive officers, other than Messrs. Ek and Vogel, participated in the incentive mix program. Mr. Vogel was not eligible to participate in the program because he left the company in March 2024.
She served as the Chief Executive Officer of NIO USA and Chief Development Officer of NIO Inc. from December 2015 to 2018. In 2019, she founded Fable Group, where she serves as President and Chief Executive 60 Table of Contents Officer.
Warrior worked at Cisco, most recently as Chief Technology and Strategy Officer. She served as the Chief Executive Officer of NIO USA and Chief Development Officer of NIO Inc. from December 2015 to 2018. In 2019, she founded Fable Group, where she serves as President and Chief Executive Officer.
Additionally, Mr. Lorentzon has held senior roles at Telia Company and Cell Ventures. He holds a Master of Science in Civil Engineering from the Chalmers University of Technology. Katarina Berg is our Chief Human Resources Officer.
Lorentzon founded Tradedoubler, an internet marketing company based in Stockholm, Sweden, and initially served as a member of its board of directors. Additionally, Mr. Lorentzon has held senior roles at Telia Company and Cell Ventures. He holds a Master of Science in Civil Engineering from the Chalmers University of Technology. Katarina Berg is our Chief Human Resources Officer.
In 2023, each of our non-employee directors participated in the incentive mix program. None of our non-employee directors are party to a service contract with us that provides for any benefits upon termination of service.
In addition, the compensation for our board of directors is subject to shareholder approval. 72 Table of Contents In 2024, each of our non-employee directors participated in the incentive mix program. None of our non-employee directors are party to a service contract with us that provides for any benefits upon termination of service.
The following table shows the dollar amount of incentive compensation awarded to each named executive officer, as well as the allocations chosen by each such individual: Named Executive Officer Aggregate Long-Term Incentive Award Dollar Value ($) 2023 At-the-Money Stock Option Allocation 2023 Out-of-the-Money Stock Option Allocation 2023 RSU Allocation 2023 Cash Allocation ($) Daniel Ek — — — — — Paul Vogel 4,320,000 — — 36,860 — Dustee Jenkins 3,500,000 — — 14,932 1,750,000 Alex Norström 10,400,000 133,106 — 44,369 — Gustav Söderström 10,400,000 266,212 — — — Long-Term Incentive Award Decisions Each year our people experience and compensation committee reviews and, if needed, recommends updates to our current equity program to our board of directors for approval in order to incentivize our employees, including our named executive officers.
The following table shows the dollar amount of incentive compensation awarded to each named executive officer, as well as the allocations chosen by each such individual: Named Executive Officer Aggregate Long-Term Incentive Award Dollar Value ($) 2024 At-the-Money Stock Option Allocation 2024 Out-of-the-Money Stock Option Allocation 2024 RSU Allocation 2024 Cash Allocation ($) Daniel Ek — — — — — Christian Luiga 5,000,000 9,989 — — 3,750,000 Dustee Jenkins 4,500,000 12,796 — 12,796 — Alex Norström 12,500,000 71,090 — 23,697 — Gustav Söderström 12,500,000 142,180 — — — 61 Table of Contents Long-Term Incentive Award Decisions Each year our people experience and compensation committee reviews and, if needed, recommends updates to our current equity program to our board of directors for approval in order to incentivize our employees, including our named executive officers.

… 116 more changes not shown on this page.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

14 edited+1 added−1 removed16 unchanged
Share Ownership—Warrants” and Note 26 to the consolidated financial statements included elsewhere in this report for a description of the transactions relating to the warrants purchased by Mr. Ek. We have entered into an indemnification agreement with each of our directors, executive officers, and certain other employees.
Share Ownership—Warrants” and Note 25 to the consolidated financial statements included elsewhere in this report for a description of the transactions relating to the warrants purchased by Mr. Ek. We have entered into an indemnification agreement with each of our directors, executive officers, and certain other employees.
Major Shareholders The following table sets forth, as of December 31, 2023 (except where noted), the number of our ordinary shares and beneficiary certificates held by each person we know to be the beneficial owner of more than 5% of our ordinary shares and beneficiary certificates, respectively, and the percentage of total votes held by each such person.
Major Shareholders The following table sets forth, as of December 31, 2024 (except where noted), the number of our ordinary shares and beneficiary certificates held by each person we know to be the beneficial owner of more than 5% of our ordinary shares and beneficiary certificates, respectively, and the percentage of total votes held by each such person.
In addition, our articles of association provide that any such conflict of interest must be reported to the next general meeting of shareholders of the Company prior to any resolution taking place at such meeting. 77 Table of Contents Please see “Item 6. Directors, Senior Management and Employees—E.
In addition, our articles of association provide that any such conflict of interest must be reported to the next general meeting of shareholders of the Company prior to any resolution taking place at such meeting. Please see “Item 6. Directors, Senior Management and Employees—E.
We have issued ten beneficiary certificates per ordinary share issued by us and held of record to entities beneficially owned by our founders, Daniel Ek and Martin Lorentzon, for a total of 343,841,690 beneficiary certificates outstanding as of December 31, 2023.
We have issued ten beneficiary certificates per ordinary share issued by us and held of record to entities beneficially owned by our founders, Daniel Ek and Martin Lorentzon, for a total of 324,732,980 beneficiary certificates outstanding as of December 31, 2024.
Ek may be deemed to share beneficial ownership of the ordinary shares held of record by TME Hong Kong, Image Frame, Tencent Mobility Limited, and Distribution Pool Limited. Additionally, each of D.G.E. Holding and Mr. Ek may be deemed to share beneficial ownership of the ordinary shares held of record by D.G.E. Investments. The business address of D.G.E.
Investments, which holds an irrevocable proxy with regard to these ordinary shares. As such, Mr. Ek may be deemed to share beneficial ownership of the ordinary shares held of record by TME Hong Kong, Image Frame, Tencent Mobility Limited, and Distribution Pool Limited. Additionally, each of D.G.E. Holding and Mr.
As of December 31, 2023, the registrar and transfer agent for our Company reported that 162,752,342 of our ordinary shares were held by 422 record holders in the United States and none of our beneficiary certificates were held by record holders in the United States.
As of December 31, 2024, the registrar and transfer agent for our Company reported that 172,451,326 of our ordinary shares were held by 436 record holders in the United States and none of our beneficiary certificates were held by record holders in the United States.
(3) Based on information reported on Schedule 13G/A, as filed by Baillie Gifford & Co (Scottish partnership) (“Baillie Gifford”) with the SEC on January 26, 2024, Baillie Gifford has the following powers with respect to our ordinary shares: (i) sole voting power: 17,522,563; (ii) shared voting power: 0; (c) sole dispositive power: 23,657,094; and (iv) shared dispositive power: 0.
(3) Based on information reported on Schedule 13G/A, as filed by Baillie Gifford & Co (Scottish partnership) (“Baillie Gifford”) with the SEC on November 5, 2024, Baillie Gifford has the following powers with respect to our ordinary shares: (i) sole voting power: 11,508,150; (ii) shared voting power: 0; (c) sole dispositive power: 15,570,335; and (iv) shared dispositive power: 0.
Ek exercises voting power over the ordinary shares held of record by TME Hong Kong, Image Frame, Tencent Mobility Limited, and Distribution Pool Limited through his indirect ownership of D.G.E. Investments, which holds an irrevocable proxy with regard to these ordinary shares. As such, Mr.
Investments. Mr. Ek is the sole shareholder of D.G.E. Holding, which is the sole shareholder of D.G.E. Investments. Mr. Ek exercises voting power over the ordinary shares held of record by TME Hong Kong, Image Frame, Tencent Mobility Limited, and Distribution Pool Limited through his indirect ownership of D.G.E.
Holding and D.G.E. Investments is 1 Alexandrou Panagouli, Office 2B, Novel Tower, 6057 Larnaca, Cyprus. The business address of Mr. Ek is c/o Spotify AB Regeringsgatan 19, 111 53 Stockholm, Sweden. (2) Includes 21,469,762 ordinary shares held by Rosello. Also includes 52.039 ordinary shares issuable pursuant to options that are held of record by Mr.
Ek may be deemed to share beneficial ownership of the ordinary shares held of record by D.G.E. Investments. The business address of D.G.E. Holding and D.G.E. Investments is 1 Alexandrou Panagouli, Office 2B, Novel Tower, 6057 Larnaca, Cyprus. The business address of Mr. Ek is c/o Spotify AB Regeringsgatan 19, 111 53 Stockholm, Sweden.
The percentage of beneficial ownership for the following table is based on 197,143,389 total ordinary shares and 343,841,690 total beneficiary certificates outstanding as of December 31, 2023.
The percentage of beneficial ownership for the following table is based on 203,844,409 total ordinary shares and 324,732,980 total beneficiary certificates outstanding as of December 31, 2024.
Our beneficiary certificates carry no economic rights and are issued to provide the holders of such beneficiary certificates additional voting rights; however, each beneficiary certificate entitles its holder to one vote. 76 Table of Contents In accordance with the rules of the SEC, beneficial ownership includes voting or investment power with respect to securities and includes the ordinary shares issuable pursuant to options, warrants, and RSUs that are exercisable or settled within 60 days of December 31, 2023.
In accordance with the rules of the SEC, beneficial ownership includes voting or investment power with respect to securities and includes the ordinary shares issuable pursuant to options, warrants, and RSUs that are exercisable or settled within 60 days of December 31, 2024.
Investments. Also includes 800,000 ordinary shares issuable pursuant to warrants that are held of record by D.G.E. Investments that are exercisable or settled within 60 days of December 31, 2023. Mr. Ek is the sole shareholder of D.G.E. Holding, which is the sole shareholder of D.G.E. Investments. Mr.
(2) Includes 20,000,000 ordinary shares held by Rosello. Also includes 45,566 ordinary shares issuable pursuant to options that are held of record by Mr. Lorentzon that are exercisable within 60 days of December 31, 2024. Mr. Lorentzon is the sole shareholder of Amaltea, which is the sole 74 Table of Contents shareholder of Rosello.
Ordinary Shares Beneficiary Certificates (5) Percent of Total Voting Power Name Number Percent Number Percent Daniel Ek (1)(6) 30,856,376 15.6 % 134,244,070 39.0 % 30.5 % Martin Lorentzon (2) 21,528,184 10.9 % 209,597,620 61.0 % 42.7 % Baillie Gifford & Co (3) 23,657,094 12.0 % — — 4.4 % Tencent (4) 16,631,969 8.4 % — — — (6) ________________________ (1) Includes 13,424,407 ordinary shares that are held by D.G.E.
Ordinary Shares Beneficiary Certificates (5) Percent of Total Voting Power Name Number Percent Number Percent Daniel Ek (1)(6) 29,105,267 14.3 % 124,732,980 38.4 % 29.1 % Martin Lorentzon (2) 20,051,949 9.8 % 200,000,000 61.6 % 41.6 % Baillie Gifford & Co (3) 15,570,335 7.6 % — — 2.9 % Tencent (4) 16,631,969 8.2 % — — — (6) ________________________ (1) Includes 12,473,298 ordinary shares that are held by D.G.E.
Lorentzon that are exercisable within 60 days of December 31, 2023. Mr. Lorentzon is the sole shareholder of Amaltea, which is the sole shareholder of Rosello. As such, each of Amaltea and Mr. Lorentzon may be deemed to share beneficial ownership of the shares held of record by Rosello.
As such, each of Amaltea and Mr. Lorentzon may be deemed to share beneficial ownership of the shares held of record by Rosello. The business address of Rosello is 22 Stasikratous Street, Office 001, 1065 Nicosia, Cyprus.
Removed
The business address of Rosello is 22 Stasikratous Street, Office 001, 1065 Nicosia, Cyprus.
Added
Our beneficiary certificates carry no economic rights and are issued to provide the holders of such beneficiary certificates additional voting rights; however, each beneficiary certificate entitles its holder to one vote.

Other SPOT 10-K year-over-year comparisons