Spotify has announced another record-breaking quarter, following its first-ever increase in Premium subscription prices a year ago. In its second quarter report, the Swedish audio streaming platform revealed an operating income of 266 million euros ($289 million), a significant turnaround from a loss of 247 million euros ($268 million) in the same period last year. The number of monthly active users also grew by 14% year-on-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 this earnings report, Spotify’s stock surged nearly 14% during pre-market trading on Tuesday. Earlier in June, the company announced price hikes for its Premium plans in the U.S., effective this month. Individual plan subscribers will see a $1 increase to $12, Duo plan users will face an additional $2 charge to $17, and Family plan users will pay $3 more, totaling $20. Last July marked the first increase in membership costs in 13 years, averaging $1.
Despite these price adjustments, Spotify successfully added seven million net subscribers in the quarter, exceeding its own projections by one million. A Bloomberg analysis noted Spotify’s dominance as the world’s leading audio streaming service, with its users being the least likely among streaming platforms to cancel their subscriptions.
However, the company’s financial journey has not always been smooth. In 2022, Spotify’s stock value plummeted by more than two-thirds as it experienced multiple quarters of operational losses. In January 2023, the company announced a layoff of 600 employees, followed by another reduction of 1,500 jobs, which constituted approximately 17% of its workforce, less than a year later.