The launch of Spotify's highly anticipated high-fidelity audio streaming has sent ripples through the tech industry, impacting the stock prices of major competitors Apple and Amazon. On Wednesday morning, Apple (AAPL) shares experienced a significant drop of over 2%, trading at approximately $228, while Amazon (AMZN) saw a decline of 1.85%, settling around $234. This downturn comes on the heels of Apple's September product launch, which was deemed "disappointing" by some analysts, further contributing to the stock price decrease.
The competitive landscape of music streaming has intensified with Spotify's rollout of CD-quality audio to its Premium subscribers in over 50 markets, including the US, UK, and Japan. While Apple Music introduced lossless audio in 2021 and Amazon Music offered similar quality since 2019 (even making it free four years ago), Spotify's move represents a significant challenge. The gradual rollout allows Spotify to manage infrastructure demands while addressing a key consumer demand for enhanced audio quality.
Interestingly, the launch wasn't entirely unexpected. Rumors of a high-fidelity option, possibly tied to a more expensive premium plan, have circulated since 2021. Code discovered earlier this year within the Spotify app further fueled speculation. The news arrives shortly after Spotify launched a new in-app messaging feature and follows Apple's recent partnership with TuneIn radio.
Despite the competitive pressure, Wall Street analysts maintain a Moderate Buy consensus rating on Spotify (SPOT) shares on TipRanks, based on recent Buy and Hold ratings. The average price target of $765.40 suggests a potential growth of 7.08% from the current level, indicating continued investor confidence in the company's overall trajectory, even in the face of this increased competition in the high-fidelity audio market. However, the impact on Apple and Amazon's stock prices underscores the fiercely competitive nature of the music streaming business and the significant influence of feature updates on market perception.
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Originally published at: https://www.tipranks.com/news/apple-aapl-and-amazons-stocks-slide-as-spotify-delivers-long-awaited-premium-audio
