Spotify shares have been on a rollercoaster ride this week, rising 3.9% after the company announced a price increase in the U.S. on Monday (June 3). The stock rose to a 52-week high of $331.08 on Wednesday (its highest since February 25, 2021) before closing at $308.11 on Friday (June 7).
After increasing subscription prices in the US and many other major markets in July 2023, Spotify further increased its rates in the UK and Australia in May. The additional increase in the US, which takes effect in July, will raise the individual rate to $11.99 per month and the family plan to $19.99 per month. The price increase allows Spotify to cover the cost of bundling exclusive free streaming of music and audiobooks. However, the streamer is offering customers more choice. A music-only plan has been introduced in the UK, costing £10.99 ($13.99) per month, with a music and audiobook option for £11.99 ($15.26) per month. The two-person Duo and Student plans are also discounted over the standard individual plan.
The Billboard Global Music Index rose 0.1% to 1,801.44 as Spotify's gains masked declines for 13 of the 20 companies in the index. Other large companies in the index were down smaller amounts this week. Warner Music Group was down 0.9% to $29.51, Universal Music Group was down 1.2% to 28.23 euros ($30.53) and Live Nation was down 3.4% to $90.56. The index is 2.5% below its all-time high of 1,847.64, recorded in the week ending May 3, 2024.
The index's biggest gainer for the second consecutive week was iHeartMedia, which rose 35% to $1.25 after rising 6.4%. In just two weeks, iHeartMedia's year-to-date losses improved from 67.4% to 53.2% without any major news releases or regulatory filings. At the company's annual meeting on Wednesday (June 5), shareholders re-elected CEO Bob Pittman and CFO/COO Rich Bressler to the board of directors and approved an advisory vote on the company's 2023 executive compensation.
SM Entertainment fell 8.5% to 83,500 won ($60.51) amid controversy over an alleged sex scandal involving Johnny and Haechan of the group NCT, which SM Entertainment denies. Such large drops are not uncommon when K-pop companies' artists make the news in South Korea. In October, K-pop stocks fell following news that SM Entertainment artists EXO would be moving to another agency. In April, HYBE's shares plummeted after news broke that Min Hee-jin, CEO of HYBE-affiliated label ADOR, was looking to take control of the subsidiary label.
Meanwhile, CTS Eventim rose 4.3 percent to 82.80 euros ($89.56). On Thursday (June 6), the German concert promoter and ticket distributor acquired Vivendi's festival and ticket sales business for $327 million. Last year, See Tickets sold 44 million tickets and generated revenue of 105 million euros ($114 million). The deal does not include See Tickets France.
SiriusXM shares fell 9.5% this week to $2.56, bringing its year-to-date loss to 53.2%. The satellite radio company, which also owns streaming platform Pandora, is betting on the success of its new streaming app and $9.99-per-month rates, which it announced in December. CEO Jennifer Witts said at the JPMorgan Global Technology, Media & Communications Conference on May 21 that the rate for its in-car satellite product, which includes streaming access, is “about $19 a month.” The company is trying to retain its satellite customers while attracting new streaming customers and relying less on promotional discounts. “We think there's an opportunity to capture more demand, but also to maintain a full price base at those higher price points and gradually increase rates,” Witts said.
Some U.S. stock indexes hit all-time highs this week. The S&P 500 hit a record high of 5,375.08 on Friday before closing down 0.1% at 5,346.99. The tech-heavy Nasdaq Composite Index hit a record high of 17,235.73 on Thursday and closed at 17,133.12 on Friday, up 2.4% from the previous week. In the UK, the FTSE 100 fell 0.4% to 8,245.37. South Korea's KOSPI Composite Index rose 3.3% to 2,722.67. China's Shanghai Composite Index fell 1.2% to 3,051.28.