Spotify’s (SPOT) Management Views 2025 as “Year of Accelerated Execution”

Sands Capital, an investment management company, released its “Sands Capital Select Growth Strategy” Q1 2025 investor letter. A copy of the letter can be downloaded here. Select Growth Strategy primarily targets U.S. companies that are leading the way in crucial areas of positive structural transformation within the economy. U.S. growth equities, tracked by the Russell 1000 Growth Index, experienced their poorest quarterly performance since 2022, significantly lagging behind U.S. value equities, represented by the Russell 1000 Value Index, in the widest gap observed since 2001. The strategy slightly underperformed the Russell 1000 Growth Index in the quarter. You can check the fund’s top 5 holdings to know more about its best picks for 2025.

In its first-quarter 2025 investor letter, Sands Capital Select Growth Strategy highlighted stocks such as Spotify Technology S.A. (NYSE:SPOT). Headquartered in Luxembourg City, Luxembourg, Spotify Technology S.A. (NYSE:SPOT) offers audio streaming subscription services. The one-month return of Spotify Technology S.A. (NYSE:SPOT) was 4.31%, and its shares have appreciated by 112.08% over the past 52 weeks. On May 30, 2025, Spotify Technology S.A. (NYSE:SPOT) closed at $665.14 per share, with a market capitalization of $136.391 billion.

Sands Capital Select Growth Strategy stated the following regarding Spotify Technology S.A. (NYSE:SPOT) in its Q1 2025 investor letter:

“Spotify Technology S.A. (NYSE:SPOT) is the world’s largest subscription streaming audio service by market share. The business delivered strong fourth-quarter 2024 results, with robust revenue and monthly active user growth, along with gross and operating margin expansion. It also reported its strongest quarter of premium subscription net additions in five years. Management is calling 2025 the “year of accelerated execution” following 2024’s “year of monetization.” We view this as a positive signal of continued operating expense discipline and product innovation, including the launch of a new premium “Music Pro” tier.”

Is Spotify Technology S.A. (SPOT) the Best Stock to Buy According to Jim Simons’ Renaissance Technologies?

A person wearing headphones listening to an audio streaming service.

Spotify Technology S.A. (NYSE:SPOT) is in 25th position on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 106 hedge fund portfolios held Spotify Technology S.A. (NYSE:SPOT) at the end of the first quarter, which was 101 in the previous quarter. In Q1 2025, Spotify Technology S.A. (NYSE:SPOT) generated a total revenue of $4.2 billion, reflecting a year-over-year growth of 15% on a constant currency basis. While we acknowledge the potential of Spotify Technology S.A. (NYSE:SPOT) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the undervalued AI stock set for massive gains.

In another article, we covered Spotify Technology S.A. (NYSE:SPOT) and shared the list of best stocks to buy according to Jim Simons’ Renaissance Technologies. In Q1 2025, Spotify Technology S.A. (NYSE:SPOT) contributed to the performance of Baron Focused Growth Fund. In addition, please check out our hedge fund investor letters Q1 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.