Spotify has announced a record profit for the second quarter, following its first-ever price increase for Premium plans last year. The company reported an operating income of 266 million euros ($289 million), a significant improvement from a loss of 247 million euros ($268 million) in the same quarter last year. Monthly active users also saw a 14% increase, reaching 626 million.
CEO Daniel Ek expressed enthusiasm 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. This all bodes very well for the future.” Following the positive earnings report, Spotify’s stock surged nearly 14% in pre-market trading.
In June, Spotify announced price hikes for its Premium service in the U.S. Individual plans increased by $1 to $12, Duo plans by $2 to $17, and Family plans by $3 to $20. This marked the first price adjustment in 13 years. Despite the increases, the company managed to add seven million net subscribers during the quarter, surpassing its previous guidance.
Spotify remains the leading audio streaming service globally and has the lowest cancellation rates among major streaming platforms, according to a Bloomberg analysis. However, the company has faced challenges in recent years, with stock prices plummeting by more than two-thirds in 2022 and significant layoffs of 1,500 employees in early 2023, following previous job cuts.