Spotify Technology S.A. (SPOT) shares are soaring 5.05% in Wednesday's intraday trading following the company's impressive first-quarter earnings report and a wave of positive analyst reactions.

The music streaming giant reported robust financial results for Q1 2025, with total revenue reaching €4.2 billion, representing a 15% year-on-year growth on a constant currency basis. Spotify's premium revenue grew by 16% year-on-year, driven by strong subscriber growth and ARPU gains. The company's gross margin improved significantly to 31.6%, surpassing guidance and expanding by approximately 400 basis points year-on-year.

Following the earnings release, several analysts raised their price targets for Spotify. Notably, Morgan Stanley increased its target price to $700 from $670, maintaining an Overweight rating. Barclays, while slightly lowering its target to $650 from $710, maintained a positive outlook on the stock. These upgrades reflect growing confidence in Spotify's business model and growth prospects.

Spotify's continued success in growing its user base has been a key driver of investor optimism. The company reported 268 million subscribers, up 12% year-on-year with a net addition of 5 million in the quarter. This growth, particularly strong in emerging markets, demonstrates Spotify's ability to expand its global footprint and maintain its position as a leader in the competitive streaming market.

As Spotify continues to innovate and expand its offerings in podcasts and audiobooks, investors appear increasingly confident in the company's long-term growth potential. The stock's strong performance today reflects this positive sentiment and the market's approval of Spotify's strategic direction.