The first steps of Deezer on the Paris Stock Exchange were not very encouraging for the streaming service. The stock has slumped since its listing this week.
Deezer, the French streaming service, pulled back at the last moment in 2015, when the company was already planning its IPO. Seven years later, Jeronimo Folgueira, the company’s general manager, assured that this time was the right time to start: ” Music streaming is really established, accounting for almost two-thirds of recorded music revenue, which was not the case before “, he explained.
The harder the fall
But if Deezer was ready, this was not the case for investors who shunned the title. At 11 a.m. on July 5, the first day of trading, the stock fell by 35%! It ended the day at -30%, at a price of 6 euros while its introductory price was 8.50 euros.
And the situation hardly improved the following days, with a continuous decline (but in proportions all the same less important). The context is particularly difficult for Deezer, as it is for all digital companies. Spotify’s stock has lost 60% of its value since January.
More generally, the Nasdaq, the American reference index for technologies, collapsed by 30% over the same period. Under these conditions, it seemed really difficult for little Deezer to get out of the game. This does not prevent the company from displaying its ambition, that of doubling its turnover by 2025 by betting on its core business, namely music.
No question of embarking on an all-out diversification like Spotify, which invests heavily in podcasts. To remain competitive, Deezer will also take advantage of its agreements with operators in Europe to be sold in bundles with subscriptions. The service has just under 10 million subscribers.