Spotify Technology (SPOT) continues to dominate the global market for subscription music streaming but it’s losing share to faster-growing rivals, a research firm says. Spotify stock dropped on the news.
Midia Research estimates that Spotify had 32% share of global music subscribers in the first quarter. Stockholm-based Spotify ended the March quarter with 158 million premium subscribers worldwide.
Apple (AAPL) was in second place with 16% share for Apple Music, Midia said. Amazon.com (AMZN) service Amazon Music tied for third place with China’s Tencent Music (TME) at 13% share each. YouTube Music from Alphabet‘s (GOOGL) Google followed in fifth place with 8% market share.
Spotify lost two percentage points of market share from the first quarter in 2020, Mark Mulligan, an analyst with Midia Research, said in a blog post. The reason is other services grew faster.
Spotify Stock Drops
In afternoon trading on the stock market today, Spotify stock fell 1.2%, near 259.80.
Last year, Spotify’s premium subscriber count increased by 24%. However, Google’s service grew by 60% and Tencent increased by 40%, Midia said. Meanwhile, Amazon Music grew 27%. By contrast, Apple Music was a laggard in 2020, increasing its subscriber count by just 12%.
“Google’s YouTube Music has been the standout story of the music subscriber market for the last couple of years, resonating both in many emerging markets and with younger audiences across the globe,” Mulligan said. “The early signs are that YouTube Music is becoming to Gen Z what Spotify was to Millennials half a decade ago.”
At the end of the first quarter, the global music streaming market had 487 million subscribers, Midia said.
Year-to-date through Friday’s close, Spotify stock is down 16.5%. Spotify stock has poor IBD Relative Strength Rating of 12 out of 99. The Relative Strength Rating shows how a stock’s price performance stacks up against all other stocks over the last 52 weeks.
Follow Patrick Seitz on Twitter at @IBD_PSeitz for more stories on consumer technology, software and semiconductor stocks.
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