Daniel Ek cashes out another $57.5m in Spotify stock, just three months after he banked $64m, and 6 months after he offloaded $100m in shares

Spotify co-founder and CEO Daniel Ek.

Spotify‘s largest shareholder, co-founder and CEO Daniel Ek, sold 250,000 shares of the company’s stock on Wednesday (February 7) for USD $57.5 million.

The development comes as the streaming giant posted strong financials for the fourth quarter of 2023.

Ek, known for not taking an annual salary from Spotify, held 31.93 million ordinary shares, representing 16.5% of the company, by the end of 2022. This translates to a staggering $7.69 billion at SPOT’s current share price of $240.83 as of Wednesday. 

Notably, Ek also holds voting rights for 16.63 million shares ultimately owned by Tencent Holdings, according to the company’s 2022 annual report.

The latest stock sale comes after Ek offloaded portions of his stake in the company last year, with the latest one in October 2023, when he sold 400,000 shares for $64.21 million. Both the latest and the October transactions were executed by D.G.E Investments Limited, an entity solely owned by Ek.

Ek purchased the 250,000 shares that he sold on Wednesday in June 2016 at the time when Spotify reached 100 million active users, an SEC filing showed.

With Spotify’s share price up 27.56% just since the start of the year, and with the company boasting a $47 billion market cap, according to Google Finance, Ek sold his shares at the highest price the stock has seen since late 2021. 

The latest share sale by Ek follows a separate offloading of stock by the Spotify founder in July 2023, when he sold 675,000 shares, which at the time were worth just over $100 million.

The transaction in July was also executed by D.G.E Investments Limited.

The latest sale comes as Spotify posted robust earnings in the final quarter of 2023. Its monthly active users surged 23% year over year to 602 million, exceeding the company’s target by 1 million. The number of its subscribers grew 15% YO Y to 236 million, also higher by 1 million versus the company’s guidance.

Revenue in Q4 edged up 16% YOY to €3.7 billion ($3.99 million), resulting in a slimmer operating loss of €75 million ($80.82 million) in Q4 2023, versus an operating loss of €231 million ($248.9 million) in Q4 2022.

Spotify Chief Financial Officer Paul Vogel explained to analysts during an earnings call that the company’s operating loss was impacted by about €143 million ($154 million) of charges related to SPOT’s “efficiency actions” announced in December.

Excluding these charges, the company generated €68 million ($73 million) of adjusted operating profit, more than double that of the third quarter, “as the business continued its early-stage inflection towards sustainable growth and profitability,” Vogel said. 

The CFO is expected to leave SPOT at the end of the first quarter. In December, he cashed out 47,859 Spotify shares, raising $9.377 million.

Spotify continues to chase profitability. Vogel told investors in October that “expectations are now that we will consistently be in the black moving forward.”

Separately on Wednesday, another SEC filing showed that Katarina Berg, Spotify’s Chief Human Resources Officer, was awarded with 32,609 shares valued at $7.7 million via a stock option exercise.

Music Business Worldwide

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