By Senad Karaahmetovic

Shares Spotify Technology The stock closed over 6 percent higher Wednesday, after the company stated that it expected to reach $100 billion annually in 10 years.

For this ambitious goal to become a reality, Spotify’s 2021 revenue of $11.4 billion would have to increase by nearly 10 times. Despite this, Daniel Ek (CEO) remains optimistic after a four-hour presentation.

Ek stated that Spotify would set out some very ambitious targets. “We are going after them because that is how we see it and that we will invest behind,” Ek added.

Spotify’s CEO also expects its gross margins to jump to 40% and its operating margins to 20% during that same period. Due to large investments made in podcast and audiobooks, the gross margins of Spotify are currently at 28% It was because of the large spending required for expansion that it did not reach long-term goals.

Even though Spotify took a big hit over last year’s controversy surrounding its most popular podcast, hosted by Joe Rogan, Spotify’s chief content officer, Dawn Ostroff, still sees podcasting as a $20 billion opportunity.

Over $1B was invested in podcasting and the company expects to exceed their $215 Million podcast revenue by 2021.

Spotify’s future 10-year plan also has them exploring other types of content besides music and podcasts, as they try to reach its goal of 1 billion users by 2030. Recent reports show that they have 422 million users per month.

Three Wall Street analysts discussed Spotify’s ambitious plans in research notes released today.

Rosenbatt’s Barton Crockett: “Spotify’s Investor Day June 8 was impressive, but at times strained credulity. Positives included new disclosures that fleshed out the company’s long-standing contention that gross margins in its core music business have been trending positively, and that recent pressures are tied to podcast investments. Spotify gave a plausible expectation that podcast investment would shift from headwinds to tailwinds in the coming years and that core business (ex-new growth investments) will trend toward the 2020 IPO’s long-term goal of 10% operating margins. But we found the talk of long-term quadrupling of ARPU and attaining a 20% operating margin to be thinly supported.”

Morgan Stanley’s Benjamin Swinburne: “Three primary takeaways – 1) guidance is for more rapid gross margin expansion than expected, 2) core music margins have been scaling, and 3) it remains early days. Spotify’s history of product innovation and share gains, combined with a valuation not pricing in success, reinforce our OW view.”

Wolfe Research’s Deepak Mathivanan: “We came away feeling incrementally bullish on the company’s opportunity in the broader audio space and confident on the strategic initiatives to achieve strong growth over next several years. We also found the company’s additional disclosure on core music and podcast businesses helpful to parse out near-term investment areas and margin expansion potential over time. On targets, we think the medium-term and long-term financial outlooks are ambitious on first glance but see a path for SPOT to achieve them over time…While we are encouraged by what we heard on the analyst day, we prefer to remain on the sidelines until we see further progress towards the MT financial goals in the next few quarters.”