Despite missing analysts' expectations for ad revenue and subscribers, Spotify (SPOT -2.02%) did post some positive numbers in its most recent earnings report. In this video clip from "The Virtual Opportunities Show" on Motley Fool Live, recorded on May 3, contributors Jose Najarro and Travis Hoium outline some metrics that show it could be a good time to buy stock in the digital music service.

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Jose Najarro: We can see Spotify right now. In the past 12 months, it's down about 56%, definitely taken quite a hit. We can also see that the company when they report earnings took a hit down. But there was some good news, it wasn't all bad for Spotify.

First, they did beat on revenue and earnings per share expectations. What they did miss was on ad revenue expectations, I think analysts were expecting about $20, $30 million more on their ad revenue than intended. But so they miss there, this was also one of their greatest quarters for ad revenue, it equaled about 11% of total revenue. They did grow in monthly active users, in premium subscribers, and add monthly active users year-over-year and quarter-over-quarter.

But, there's always a but, they missed analysts' expectations by about 1 million. Spotify and management does say that one of the biggest reasons that they lost out on these expectations was because the overall Ukraine and Russia tensions have caused about 1.5 million subscribers.

They did guide about 428 million monthly active users. I think it's impressive how many monthly active users they run. Not many people know it's that high, 187 million premium subscribers. That would again be a quarter-over-quarter and year-over-year increase. They are already accounting for more tensions in Russia and Ukraine and other outages.

What I do want to say is they did grab some great partnerships. First, they partnered up with Google [a part of Alphabet (GOOG -0.86%) (GOOGL -0.83%)] Play, the App Store. We've seen a lot of tensions between Apple (AAPL -0.75%), the App Store, and some players where there's not that frictionless payments. Unless you want to go through Google's or the main operating systems pace provider. But Google and Spotify have actually allowed where Spotify can have their own payment solutions within the thing. They believe that might increase the overall growth.

Another thing is they did partner up with Walmart earlier where they are giving six-month trials to users that are applying to Walmart Plus, which is like their Amazon (AMZN -0.01%) Prime competitor. They did see a nice hit on free cash flow. But one of the major reasons is they still pay a nice amount on licensing fees. Unlike Netflix (NFLX -1.56%), this is a company that doesn't have too many originals. Most of their podcasts, most of their content that they have in their platform are usually paid to artists and such.

Overall, I think it was a good quarter. We did see growth in subscribers, which is something we, I think many people weren't expecting, especially with the whole thing where we saw Netflix actually burning subscribers. But obviously, things like free cash flow and some of their other financials taking quite a hit might have some investors worried.

Travis Hoium: I just put a link in Slido, I wrote, I dove into earnings in what I've thought about this earnings report. This is one company that I try not to look at any headlines before I look at the earnings report because exactly what Jose said, investors or analysts put an expectation on Spotify, and then if you don't hit it then the stock gets hammered and all the headlines are negative.

If you actually look at how they're operating and think about it in the context of people are going back to work, the economy's slowing down. We had a negative GDP in the first quarter. They're still growing. Subscriptions are growing, users are growing, ad revenue is growing, all at double-digit rates. There was a lot to like, I think from the company. Is it maybe a little bit, would you rather that it grow at 35% rather than 30%? Sure.

But fundamentally, I don't think anything is broken about this company, and long-term if you're bullish on Spotify, I think you have to be bullish on podcasting and the ads that go into podcasting, and both of those things are growing. I do like a lot about what's going on there. But it is one of these companies that it's going to take five years for this to play out. 

Think about investing in Facebook when they went public it seemed really expensive because they hadn't built that ad business yet. That's where Spotify is but look at the growth that you have if you get it right. Spotify's got a ton of data and a growing advertiser base as well. I agree that I think this was a good report even if the market didn't really like it.