Spotify (SPOT) was Hurt by Continued Near-Term Advertising Weakness

Artisan Partners, an investment management company, released its fourth-quarter 2025 investor letter for “Artisan Mid Cap Fund”.  A copy of the letter can be downloaded here. The Fund seeks to invest in companies that possess franchise characteristics, with strong earnings trajectories, and are trading at a discount to the estimated private market value. US equities ended a record year with robust fourth-quarter gains. The Fund’s Investor Class, ARTMX, delivered -0.44%, the Advisor Class, APDMX, delivered -0.37%, and the Institutional Class, APHMX, delivered -0.35% in the fourth quarter compared to -3.70% for the Russell Midcap® Growth Index. Continued strength in information technology (IT) and health care contributed to the performance during the quarter. Please review the Fund’s top five holdings to gain insights into their key selections for 2025.

In its fourth-quarter 2025 investor letter, Artisan Mid Cap Fund highlighted stocks like Spotify Technology S.A. (NYSE:SPOT). Spotify Technology S.A. (NYSE:SPOT) is a leading audio streaming subscription service provider monetizing through paid premium subscriptions and an ad-supported model. On February 20, 2026, Spotify Technology S.A. (NYSE:SPOT) stock closed at $490.60 per share. One-month return of Spotify Technology S.A. (NYSE:SPOT) was -6.79%, and its shares have lost 20.58% over the past twelve months. Spotify Technology S.A. (NYSE:SPOT) has a market capitalization of $98.073 billion.

Artisan Mid Cap Fund stated the following regarding Spotify Technology S.A. (NYSE:SPOT) in its fourth quarter 2025 investor letter:

"Our biggest detractors in Q4 were ROBLOX, Veeva and Spotify Technology S.A. (NYSE:SPOT). Spotify is a leading audio streaming platform that we believe is well positioned to increasingly monetize its dominant share in global music distribution and discovery through pricing, advertising and tiered premium subscriptions, with the upcoming super-premium tier serving as a meaningful catalyst. Strategic investments in podcasts, audiobooks and video diversify the business beyond music, where major labels control content. While shares declined during the quarter amid continued near-term advertising weakness, the company delivered a strong quarter with beats on users, revenue and margins, supported by improving engagement with video podcasts and ongoing monetization progress."

Spotify Technology S.A. (NYSE:SPOT) is in the 25th position on our list of 30 Most Popular Stocks Among Hedge Funds. According to our database, 120 hedge fund portfolios held Spotify Technology S.A. (NYSE:SPOT) at the end of the fourth quarter, up from 116 in the previous quarter. While we acknowledge the potential of Spotify Technology S.A. (NYSE:SPOT) as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

In another article, we covered Spotify Technology S.A. (NYSE:SPOT) and shared a list of best foreign stocks to buy. In addition, please check out our hedge fund investor letters Q4 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.