(AAPL) does not believe in advertising and Greenfield also argues that Spotify oddly has few direct competitors for advertisers looking for listeners of streaming audio. “By any metric, Spotify no longer looks expensive relative to the growth potential we see over the next few years, creating a compelling buying opportunity at these levels,” he adds. The analyst adds that he thinks Street consensus expectations for both revenue and Ebitda are “simply too low.” For 2024, Greenfield is forecasting revenue of $16.9 billion and Ebitda of $1.4 billion, while consensus calls for $15.7 billion in revenue and $900 million in Ebitda. “With the podcast-investment phase for Spotify starting to bear fruit in advertising, and the overall ad-supported music business starting to scale meaningfully, margin improvement is set to drive rapid Ebitda growth we have Ebitda growth still over 40% in 2024,” he writes. Greenfield thinks Spotify can boost advertising to 22% of revenue in 2024 from an estimated 13% in 2021. But he thinks ad growth will far outpace subscription revenue. Spotify has never increased the $9.99 a month price it charges U.S.

Greenfield sees plenty of room for upside in paid-subscriber growth-he thinks the company can add 27 million to 30 million new subs a year going forward-and he also sees room for higher revenue per user.

He thinks that “the stage is set for advertising to accelerate overall revenue growth for years to come.” Greenfield notes that Spotify today will report 2021 advertising of more than $1 billion, the first time it has crossed that mark.

Spotify stock neil young