Latest Ratios: P/E Ratio 42.7x · EV/EBITDA 38.8x · ROE 31.9%. (2015–2025 historical series)
Price-based multiples — how expensive the stock is relative to earnings, sales, book value, and cash flow
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Market Cap | $104.9B | $122.2B | $92.6B | $36.6B | $15.5B | $45.4B | $59.0B | $27.1B | $20.6B | — | — |
| Enterprise Value | $101.6B | $119.3B | $89.8B | $35.2B | $14.7B | $44.4B | $58.5B | $26.6B | $20.0B | — | — |
| P/E Ratio → | 42.66 | 55.25 | 81.34 | — | — | — | — | — | — | — | — |
| P/S Ratio | 5.36 | 7.11 | 5.91 | 2.76 | 1.32 | 4.69 | 7.49 | 4.00 | 3.91 | — | — |
| P/B Ratio | 11.34 | 14.68 | 16.76 | 14.45 | 6.49 | 21.36 | 21.07 | 13.44 | 9.81 | — | — |
| P/FCF | 32.09 | 42.56 | 40.54 | 54.29 | 736.29 | 164.45 | 326.10 | 61.79 | 93.91 | — | — |
| P/OCF | 31.43 | 41.68 | 40.24 | 53.81 | 336.13 | 125.73 | 227.90 | 47.23 | 59.79 | — | — |
P/E links to full P/E history page with 30-year chart
Enterprise-value multiples — capital-structure-neutral measures of total business value
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| EV / Revenue | — | 6.94 | 5.73 | 2.65 | 1.25 | 4.59 | 7.42 | 3.94 | 3.80 | — | — |
| EV / EBITDA | 38.80 | 51.87 | 60.45 | — | — | 201.01 | — | 1901.76 | — | — | — |
| EV / EBIT | 40.60 | 52.91 | 65.23 | — | — | 153.71 | — | — | — | — | — |
| EV / FCF | — | 41.54 | 39.33 | 52.18 | 698.51 | 160.95 | 322.94 | 60.79 | 91.25 | — | — |
Margins and return-on-capital ratios measuring operating efficiency
Full margin charts and quarterly trend are on the Earnings History page
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Gross Margin | 32.0% | 32.0% | 30.1% | 25.6% | 25.0% | 26.8% | 25.6% | 25.5% | 25.7% | 20.8% | 13.6% |
| Operating Margin | 12.8% | 12.8% | 8.7% | -3.4% | -5.6% | 1.0% | -3.7% | -1.1% | -0.8% | -9.2% | -11.8% |
| Net Profit Margin | 12.9% | 12.9% | 7.3% | -4.0% | -3.7% | -0.4% | -7.4% | -2.7% | -1.5% | -30.2% | -18.3% |
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| ROE | 31.9% | 31.9% | 28.2% | -21.7% | -19.1% | -1.4% | -24.1% | -9.1% | -6.7% | -83614.1% | — |
| ROA | 16.4% | 16.4% | 11.2% | -6.7% | -5.8% | -0.5% | -10.2% | -4.0% | -2.1% | -46.6% | -34.1% |
| ROIC | 40.5% | 40.5% | 53.1% | -24.8% | -36.0% | 4.2% | -11.6% | -3.5% | -2.9% | -67.3% | -222.6% |
| ROCE | 26.7% | 26.7% | 23.1% | -10.7% | -16.4% | 2.5% | -9.6% | -3.0% | -2.5% | -34.9% | -61.4% |
Solvency and debt-coverage ratios — lower is generally safer
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Debt / Equity | 0.28 | 0.28 | 0.36 | 0.67 | 0.70 | 0.84 | 0.21 | 0.31 | — | 3.97 | — |
| Debt / EBITDA | 1.01 | 1.01 | 1.35 | — | — | 8.08 | — | 43.92 | — | — | — |
| Net Debt / Equity | — | -0.35 | -0.50 | -0.56 | -0.33 | -0.45 | -0.20 | -0.22 | -0.28 | 1.97 | — |
| Net Debt / EBITDA | -1.28 | -1.28 | -1.87 | — | — | -4.37 | — | -31.28 | — | — | — |
| Debt / FCF | — | -1.02 | -1.22 | -2.11 | -37.78 | -3.50 | -3.17 | -1.00 | -2.67 | 3.61 | 4.85 |
| Interest Coverage | 72.74 | 72.74 | 38.25 | -12.29 | -8.02 | 7.22 | -13.04 | -2.08 | -27.83 | -2.42 | -106.00 |
Net cash position: cash ($5.3B) exceeds total debt ($2.3B)
Short-term solvency ratios and asset-utilisation metrics
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Current Ratio | 1.72 | 1.72 | 1.88 | 1.29 | 1.24 | 1.36 | 0.82 | 0.91 | 1.05 | 1.02 | 1.56 |
| Quick Ratio | 1.72 | 1.72 | 1.88 | 1.29 | 1.24 | 1.36 | 0.82 | 0.91 | 1.05 | 1.02 | 1.56 |
| Cash Ratio | 1.56 | 1.56 | 1.67 | 1.03 | 0.95 | 1.08 | 0.60 | 0.72 | 0.84 | 0.81 | 1.30 |
| Asset Turnover | — | 1.15 | 1.31 | 1.58 | 1.55 | 1.34 | 1.25 | 1.34 | 1.21 | 1.28 | 1.40 |
| Inventory Turnover | — | — | — | — | — | — | — | — | — | — | — |
| Days Sales Outstanding | — | 19.49 | 18.61 | 24.28 | 21.45 | 23.70 | 21.65 | 21.66 | 27.92 | 32.96 | 38.03 |
Earnings, FCF, buyback, and dividend yields — total returns to shareholders
Full dividend history and growth charts are on the Dividend History page
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Dividend Yield | — | — | — | — | — | — | — | — | — | — | — |
| Payout Ratio | — | — | — | — | — | — | — | — | — | — | — |
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings Yield | 2.3% | 1.8% | 1.2% | — | — | — | — | — | — | — | — |
| FCF Yield | 3.1% | 2.3% | 2.5% | 1.8% | 0.1% | 0.6% | 0.3% | 1.6% | 1.1% | — | — |
| Buyback Yield | 0.5% | 0.4% | 0.1% | 0.2% | 0.0% | 0.3% | 0.1% | 1.6% | 0.4% | — | — |
| Total Shareholder Yield | 0.5% | 0.4% | 0.1% | 0.2% | 0.0% | 0.3% | 0.1% | 1.6% | 0.4% | — | — |
| Shares Outstanding | — | $211M | $207M | $195M | $196M | $194M | $188M | $181M | $181M | $178M | $168M |
Includes 30+ ratios · 11 years · Updated daily
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Quick answers to the most common questions about buying SPOT stock.
Spotify Technology S.A.'s current P/E ratio is 42.7x. The historical average is 68.3x.
Spotify Technology S.A.'s current EV/EBITDA is 38.8x. This enterprise value multiple compares the company's total value (equity + debt - cash) to its EBITDA. The historical average is 56.2x.
Spotify Technology S.A.'s return on equity (ROE) is 31.9%. This is above the typical threshold of 15-20% considered good for most companies. The historical average is -13.6%.
Based on historical data, Spotify Technology S.A. is trading at a P/E of 42.7x. Compare with industry peers and growth rates for a complete picture.
Spotify Technology S.A. has 32.0% gross margin and 12.8% operating margin. Operating margin between 10-20% is typical for established companies.
Spotify Technology S.A.'s Debt/EBITDA ratio is 1.0x, indicating moderate leverage. A ratio below 2x is generally considered financially healthy.
Key Metrics
Top Statement Risk
Premium valuation amid growth slowdown
Margin Inflection Driven by Structural Shifts
Spotify's gross margin has expanded from 27.6% in Q1 2024 to 33.4% in Q2 2026, a trend that appears to reflect successful pricing power and a strategic shift in content cost mix away from pure music royalties, as indicated in the provided financial statements.
The improvement in operating margin from 4.6% to 13.7% over the same period demonstrates meaningful operating leverage, suggesting the company is scaling its overhead effectively. However, the net margin remains volatile, swinging from 5.4% to 11.4% in the last two quarters, indicating that non-operational items continue to distort the underlying earning power. Investors should monitor if the ~33% gross margin level represents a new, sustainable plateau.
ROIC Rebounding but Efficiency Lagging
Return on invested capital (ROIC) rebounded to 16.0% in Q2 2026 after dipping to 8.5% in Q2 2025, a recovery that appears to be driven by improving profitability rather than a meaningful acceleration in asset turnover, which has remained below historical levels.
The trend in ROIC versus ROA suggests that the capital structure is becoming more efficient as leverage decreases, but the asset turnover ratio has actually declined from 0.42 in Q1 2024 to 0.36 in Q2 2026. This implies that while the business is generating more profit per dollar of revenue, it is also deploying more capital to generate those sales. The sustainability of this ROIC trajectory will depend on whether asset efficiency can improve alongside margins.
Debt Service Becoming Negligible
Spotify's debt-to-equity ratio collapsed from 0.53 in Q1 2024 to just 0.06 in Q2 2026, while interest coverage surged to 60.67x, indicating that debt service has become a trivial expense relative to operating profits, as shown in the ratio data.
This dramatic de-leveraging, driven by both debt reduction and a surge in retained earnings, has virtually eliminated refinancing risk and freed up capital for shareholder returns via buybacks. The current leverage profile is more characteristic of a mature, cash-generative business than a high-growth platform, which may lead some to re-evaluate the company's cost of equity. The primary risk now shifts from balance sheet concerns to the efficient deployment of the accumulating cash.
Liquidity Buffer Exceeds Liability Coverage
With a quick ratio of 2.11 in Q2 2026, Spotify's liquid assets more than double its current liabilities, creating a substantial buffer that suggests the company could withstand a severe, prolonged revenue disruption without facing a liquidity crisis.
The company's cash-to-total-liabilities ratio, as derived from the balance sheet analysis, exceeds 109%, indicating that its cash reserves alone could cover all obligations. This fortress-like position removes any near-term financial distress risk and provides significant strategic flexibility for investment or acquisition. However, the substantial cash balance may also raise questions from investors about capital efficiency if it is not deployed productively.
Valuation Premium Reflects Platform Potential
Spotify trades at a P/E of 43.35x and an EV/EBITDA of 39.45x, a significant premium to peers like SiriusXM (12.96x P/E) and Peloton (38.08x P/E), which appears to price in its superior growth profile and potential to evolve into a broader audio platform.
The premium is justified in part by Spotify's higher ROIC (16.0% vs. SIRI's 5.2%) and its stronger operating margin trajectory, but it also demands sustained execution on margin expansion and user growth. The gap in valuation versus traditional radio peers underscores the market's bet on Spotify's tech-enabled, global model. Investors should compare this premium to pure-play software-as-a-service companies to gauge if the platform narrative has been fully appreciated.
The P/E Multiple Hides a Margin Ceiling
The P/E ratio of 43.35x is often misapplied to Spotify because it implies a high-growth software business, while the company's core model is constrained by a structural gross margin ceiling near 33% due to oligopolistic label power, as evidenced in its financial results.
This multiple obscures the fact that sustainable, long-term margin expansion may be limited compared to true SaaS peers with gross margins above 70%. A more appropriate metric for evaluating Spotify's valuation would be EV/EBITDA, which better isolates operating performance from tax and capital structure differences. Using a high P/E to compare Spotify to software companies can lead to overestimating its terminal earnings power, as the cost of content remains a permanent, variable drag on profitability.