Spotify has announced another record profit quarter, coming one year after it implemented its first-ever price increase for Premium plans. The Swedish audio streaming service reported an operating income of 266 million euros ($289 million) for the second quarter, a significant turnaround from a loss of 247 million euros ($268 million) in the same period last year. The platform also saw monthly active users rise by 14% year-over-year to reach 626 million.
“This is an exciting time at Spotify. We keep innovating and proving that we are not only a great product but increasingly a strong business,” said CEO Daniel Ek. “Our performance has surpassed our expectations, indicating a positive future ahead.”
Following this encouraging earnings report, Spotify’s stock surged nearly 14% in pre-market trading on Tuesday.
In June, Spotify announced a price increase for its U.S. Premium users, which has now taken effect. Individual plan users will see their monthly fees rise by $1 to $12, Duo plan users will pay an additional $2 to total $17, and Family plan users will pay $3 more, reaching $20. Last July marked the first increase in membership costs in 13 years, which averaged around $1.
Despite these price hikes, Spotify added seven million net subscribers during the quarter, exceeding its own forecast by one million.
As the leading audio streaming service globally, Spotify boasts the highest user retention rates among audio and video streaming platforms, according to a Bloomberg analysis.
However, the company’s financial journey has not always been positive. Last year, Spotify shares plummeted by more than two-thirds as it experienced multiple quarters of operational losses. In January 2023, the company announced it would reduce its workforce by 600 employees, and less than a year later, another 1,500 jobs were cut, representing about 17% of its total staff.