Spotify has announced a new record profit for the second quarter, just one year after increasing the prices of its Premium subscription plans for the first time in its 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) a year earlier. The number of monthly active users also surged, reflecting a 14% annual growth to reach 626 million.
In a statement, CEO Daniel Ek expressed excitement about the company’s progress, emphasizing their commitment to innovation and the growing success of Spotify as a business. He noted that the progress made has surpassed their expectations, which signals a positive outlook for the future.
Following the earnings report, Spotify’s stock saw a nearly 14% increase during pre-market trading on Tuesday.
In June, Spotify announced increases to its Premium pricing in the U.S. Starting this month, individual plans will cost $12 (up $1), Duo plans will be $17 (up $2), and Family plans will be $20 (up $3). This price adjustment followed the first membership cost hike in 13 years, which was implemented in July of the previous year.
Despite these price hikes, Spotify managed to gain seven million net subscribers during the quarter, surpassing previous projections by one million. A Bloomberg analysis has highlighted Spotify as the leading audio streaming service globally, noting that its users are less likely to cancel their subscriptions compared to other major audio and video streaming platforms.
However, Spotify has faced financial challenges in the past. In 2022, the company’s stock lost more than two-thirds of its value amid prolonged operating losses. To manage costs, Spotify announced a restructuring plan in January 2023, which included laying off 600 employees, followed by a further reduction of 1,500 jobs—approximately 17% of its workforce—less than a year later.