Shares closed at $160.38 after shedding as much as 11 percent Thursday.
The music streaming service reported better-than-expected earnings but seemed to lose investors on lighter guidance.
Spotify went public last month with its unconventional direct listing, offering the public its first look at the company's subscriber base and ad revenue.
It cautioned Wednesday during the earnings report that growth could slow in subsequent quarters.
As of Thursday's close, the stock was down 3 percent from its debut trade of $165.90.