On the first day of its listing on July 5, 2022, Deezer saw its stock price fall by 29%, even realizing a plunge of up to 35% in the morning. For its entry on the Paris Stock Exchange, the French platform has chosen to rely on a SPAC.
For several months, technology stocks have been battered on the stock markets, and Deezer paid the price during its first steps on the Paris Stock Exchange, in the presence of the Minister of the Economy, Bruno Le Maire. On the first day of its listing, July 5, 2022, the French music streaming platform saw its stock price drop by 29%, even plummeting to 35% in the morning. In addition, the operation has enabled the company led by Jeronimo Folgueira since the summer of 2021 to raise only 143 million euros, very far from the 275 million expected.
For this stock market listing, which occurred seven years after an aborted attempt due to unfavorable market conditions, Deezer had chosen to back up with a SPAC (Special Purpose Acquisition Company), a listed front company dedicated specifically to the acquisition of another company. In this context, the French company had joined forces with I2PO, SPAC created by the holding company of the Pinault family (Artémis), the investment banker Matthieu Pigasse and Iris Knobloch, former director of WarnerMedia.
The IPO of @DeezerFR is not only an economic and technological success, but it is also a cultural success.
Defending Deezer is defending our culture. It is to defend our artists. It is to defend our memory. It is to defend our musical heritage. pic.twitter.com/RzURWMg04G— Bruno Le Maire (@BrunoLeMaire) July 5, 2022
One billion euros in revenue by 2025
Despite this approach, Deezer will not have escaped a difficult context for technology stocks, as illustrated by the case of Spotify, the Swedish music streaming giant, which has lost 60% of its capitalization on Wall Street since the start of the crisis. ‘year. To date, Deezer claims 9.6 million paying subscribers, including 5 million in France, which gives it barely 2% of the global market, very far behind Spotify (31%), according to MIDiA. However, the French platform claims nearly 30% of the French market.
After having achieved 400 million euros in turnover in 2021, Deezer is aiming for a billion euros in revenue by 2025, a horizon around which the company hopes to become profitable. For comparison, Spotify is aiming for one billion users by 2030 and $100 billion in revenue. Despite the gap between the objectives displayed by the two European companies, the challenge is immense for the French company and the Swedish platform.