Spotify shares tumbled nearly 9% on Tuesday after the streaming leader issued cautious earnings guidance for the coming months.
The company expects a second-quarter operating income of 630 million euros, missing average Wall Street analyst estimates.
Slowing growth across Europe and North America signals a shift for the platform despite its recent price adjustments.
Investors closely track profitability as the firm integrates artificial intelligence features to boost user engagement and discovery tools.
The forecast follows a record first quarter, where lower payroll taxes helped the company achieve significant financial gains.
While monthly active users exceeded expectations, the outlook for new premium subscribers fell short of industry predictions.
Spotify faces intensifying competition from tech giants like Apple and Amazon as they vie for market dominance.
The platform recently expanded its AI Playlist tool, allowing users to generate custom soundtracks using natural-language prompts.
Moving forward, the leadership team aims to balance cost-cutting measures with necessary investments in high-growth audio technology.
