Spotify has announced another quarter of record profits, following its first-ever price increase for Premium plans last year.
The Swedish audio streaming platform reported an operating income of 266 million euros (approximately $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 number of monthly active users grew by 14% year-over-year, reaching 626 million.
“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,” said CEO Daniel Ek in a statement. “We are doing so on a timeline that has exceeded even our own expectations. This all bodes very well for the future.”
Following the release of its stronger-than-expected earnings report, Spotify’s stock jumped nearly 14% in pre-market trading on Tuesday.
In June, Spotify announced a price hike for its Premium users in the U.S., effective this month. Individual plan users will see an increase of $1 to $12, Duo plan users will pay $2 more, bringing the cost to $17, and Family plan users will now pay $3 more, totaling $20. This follows a membership price increase last July, the first in 13 years, averaging $1.
Despite the price increases, Spotify successfully added seven million net subscribers during the quarter, surpassing its previous guidance by one million.
Spotify retains its status as the world’s leading audio streamer, with a Bloomberg analysis indicating that its users are the least likely among major streaming services to cancel their subscriptions.
However, the company’s financial history has been rocky. In 2022, Spotify’s stock value plummeted by over two-thirds amid multiple quarters of operating losses. Faced with challenges, the company laid off 600 employees in January 2023 and later cut an additional 1,500 jobs, representing approximately 17% of its workforce.