Spotify has announced another quarter of record profits, just a year after increasing the prices of its Premium plans for the first time in history.
The Swedish audio streaming platform reported an operating income of 266 million euros ($289 million) in the second quarter, a significant turnaround from a loss of 247 million euros ($268 million) the previous year. Monthly active users grew by 14% year-over-year, reaching 626 million.
CEO Daniel Ek expressed optimism about the company’s progress, stating, “It’s an exciting time at Spotify. We keep on innovating and showing that we aren’t just a great product, but increasingly also a great business. We are doing so on a timeline that has exceeded even our own expectations. This all bodes very well for the future.”
Following the earnings report, Spotify’s stock surged nearly 14% in pre-market trading on Tuesday.
In June, Spotify announced price increases for its Premium users in the U.S., effective this month. Individual plan users will see an increase of $1 to $12, Duo plan subscribers will pay $2 more to $17, and Family plan users will pay $3 more, totaling $20. This marked the first membership cost increase in 13 years, averaging around $1.
Despite the price hikes, Spotify added seven million net subscribers during the quarter, surpassing its previous guidance by one million.
As the world’s leading audio streaming service, Spotify users are the least likely to cancel their subscriptions, according to a Bloomberg analysis.
However, the company has faced financial challenges in the past. Spotify’s stock plummeted over 66% in 2022 due to several quarters of operating losses. In January 2023, the company announced the layoff of 600 employees, and later cut an additional 1,500 jobs, which represented about 17% of its workforce.