Spotify to test how its music service plays on Wall Street

Microsoft Senior VP of Entertainment Music & Gaming Jason Rutherford during a media presentation in Redmond WA. March 30th 2018

Microsoft Senior VP of Entertainment Music & Gaming Jason Rutherford during a media presentation in Redmond WA. March 30th 2018

It faces tough competition from the second-largest streaming company Apple Music, which has 38 million subscribers.

The direct listing was a test case for other companies tempted to list without selling new shares, and for bankers that could lose out on millions of dollars in future underwriting fees.

Last year, Spotify shares were traded privately between $37.50 and $125, the company said in its F-1 filing. It had 71 million paid subscribers as of December 31 and 157 million monthly active users.

In an interview with CBS This Morning, Ek said that while he would look at the stock price when it opened, he felt the company is only in the "second inning", emphasizing his focus on the long term. Instead it simply listed existing shares directly on the stock exchange without relying on underwriters to attract investors, set a price and stabilize the stock as it begins trading.

Hopkinsville Police Officer shot to death
Authorities said the suspect took off in a stolen white Chevrolet pickup truck with Kentucky plates, according to WSMV . Kentucky State Police released a picture of a man they say is a suspect in a deadly officer-involved shooting.

The growth was nearly entirely attributable to the public's embrace of streaming, with subscriptions to paid platforms such as Spotify, Apple Music, Tidal and the new service of retail giant Amazon growing 56 percent to 35.3 million users. Spotify is the biggest company to ever go public via direct listing, and the first on the NYSE.

Its Wall Street debut has been closely followed in recent weeks as much for the unconventional approach to a public offering it chose as for the company itself. And it feels like the right time to pause and acknowledge the thousands of Spotify employees around the globe who helped build out the Spotify ecosystem while staying true to who we are and what we believe.

"One of the things that is driving a lot of the uncertainty, this range of valuations, is that the company is highly unprofitable, has a lot of major competitors and has few direct public peers", Matthew Kennedy, an analyst at IPO research provider Renaissance Capital, told CBS Moneywatch. It has about 71 million paying customers and hopes to increase that to 96 million. The opening price puts the company's value at almost $30bn, making it one of the largest U.S. listings for a tech company in history. Instead, it is selling shares now help by its private investors and although this may save them some money, it ultimately makes the entire process volatile. Spotify subscriptions, meanwhile, are growing by an average of 2 percent per month. A huge number of shares hitting the market all at once could sink the stock price.

Rather than pursuing a traditional initial public offering or IPO, Spotify offered a direct listing, meaning it wouldn't be issuing any new stock. That could make it even more hard for investors to settle on the right price for Spotify's stock, they say.

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