Apple Music Inches Ahead of Spotify in US Subscriber Totals
July 7, 2018 by Paul AusickOne way to measure the value of Apple Inc. (NASDAQ: AAPL) is by looking at the strength of the company’s ecosystem. On Friday, we saw a bit more evidence of that strength.
Digital Music News cited an unnamed major music distributor who said that Apple’s streaming music service, Apple Music, has pulled ahead of Spotify Technology S.A. (NYSE: SPOT) in total paid U.S. subscribers. The source declined to give exact numbers, noting that both Apple and Spotify have more than 20 million paid U.S. subscribers but that Apple is now “a hair ahead.”
Spotify, which came public in early April, has more worldwide paid subscribers than Apple Music, tallying 75 million to Apple’s 45 million. Including non-paying and ad-supported users, Spotify’s total reaches roughly 170 million to Apple’s 50 million to 55 million.
A Wall Street Journal report in February predicted that Apple would overtake Spotify in U.S. subscribers sometime this summer. That prediction was based on the fact that Apple bundles its streaming music app on every iPhone, Watch and other piece of hardware the company sells. Since that report, Apple has launched its Home Pod smart speaker, and that has added even more hardware to the Apple playpen.
As is the case in most other markets that Apple competes in, music streaming revenues in the United States probably favor the company as well. Spotify offers both a free, ad-supported tier of its service and cut-rate plans for some groups, like students. Apple offers a more limited selection of discounted subscriptions.
Spotify’s post-IPO price range is $135.51 to $182.45, and that low price was the stock’s opening bid on its first-day of trading. Shares closed Friday at $175.70, well above the consensus price target of $159.32.
Apple shares closed Friday at $187.97 in a 52-week trading range of $143.37 to $194.20. The 12-month consensus price target on the stock is $200.06.
Apple’s market cap at Friday’s closing price was just short of $924 billion, compared to Spotify’s $31.3 billion.
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