adverts
Spotify co-founders Daniel Ek and Martin Lorentzon have collectively earned $900 million in stock payouts in 2024, fuelled by the streaming giant’s market valuation skyrocketing to nearly $100 billion.
This marks a dramatic recovery for Spotify, which had seen its valuation plummet below $20 billion in previous years.
Spotify executives and board members sold $1.25 billion in stock this year, according to filings with the U.S. Securities and Exchange Commission (SEC).
adverts
Most of these sales occurred in November and December, benefiting from a tripling of Spotify’s share price.
CEO Daniel Ek sold nearly $350 million worth of shares, including a $28 million transaction in December, pushing his estimated net worth to over $7 billion, according to Bloomberg.
Lorentzon, who remains on Spotify’s board, sold over $550 million in stock, solidifying his status as one of the world’s wealthiest corporate figures.
Chief Product Officer Gustav Söderström and Chief Business Officer Alex Norström also capitalised on the stock surge, selling shares valued at $106 million and $63 million, respectively.
Spotify’s remarkable stock resurgence is attributed to a renewed focus on profitability. After layoffs in 2023 and price hikes across multiple countries, the company reported profits in every quarter of 2024 while maintaining robust subscriber growth.
This strategic pivot drew praise from Wall Street. Bank of America analysts commended Spotify’s improved profit margins, while Morgan Stanley highlighted its transition from a growth-centric model to one with “emerging profit opportunities.”
Spotify’s successful turnaround has positioned it alongside Netflix as a dominant player in the streaming industry, cementing its place as a leader in the so-called “streaming wars.”
The stock sales extended beyond Spotify’s founders. Netflix CEO Ted Sarandos, a Spotify board member since 2016, sold $6 million worth of shares this year. A Spotify spokeswoman noted that the sales were part of long-term financial planning for executives, whose compensation is largely stock-based.
As Spotify continues its profitability streak, the substantial payouts underscore the vision and resilience of its leadership. Ek and Lorentzon, having navigated the company through challenging times, now stand among the tech world’s financial elite, reaping the rewards of their strategic foresight.
