April 3 (UPI) — Spotify, the world’s largest music streaming service, garnered an overall valuation of $26.5 billion after making its initial public offering Tuesday.
Shares in the company opened at $165.90 and reached a high of $169, but ultimately fell 10 percent to close at $149.01.
The closing price was 13 percent above the $132 set by the New York Stock Exchange based on previous trades on private markets.
The Swedish company, which says it has 70 million paying users and 159 million ad-supported free listeners, was created in 2006 by Martin Lorentzon and Daniel Ek.
In a blog post Monday, Ek said he is proud of the streaming service, but Tuesday’s debut on the New York Stock Exchange wasn’t the company’s top focus.
“It’s the day after, and the following day that matters — and all those days to come,” Ek wrote. “Spotify is not raising capital, and our shareholders and employees have been free to buy and sell our stock for years. So while [Tuesday] puts us on a bigger stage, it doesn’t change who we are, what we are about, or how we operate.”
Spotify said it’s focused on a long-term plan to continue growth.
“Normally, companies ring bells,” Ek wrote. “Normally, companies spend their day doing interviews on the trading floor touting why their stock is a good investment. Normally, companies don’t pursue a direct listing. While I appreciate that this path makes sense for most, Spotify has never been a normal kind of company.”
Spotify announced IPO plans in February, becoming the first publicly traded music-streaming service.
Its closest competitor, Apple Music, is expected to overtake Spotify as the most popular music service in the United States.
Apple said subscriptions have maintained a monthly growth rate of 5 percent and they have 36 million subscribers in the United States. Spotify subscriptions, meanwhile, are growing by an average of 2 percent per month. If the rates hold, Apple Music will overtake Spotify by the summer.
Spotify has predicted up to 96 million paid subscribers and a 30 percent increase in revenue by the end of 2018.
“We are about twice the size of [Apple] so I think we’ve still got some room and I’m very happy with the growth that we’re seeing in our business. I can’t speak for them, but I feel pretty comfortable,” Ek said.