Spotify has announced another record profit quarter, marking a year since it increased the prices of its Premium plans for the first time.
The Swedish audio streaming company reported an operating income of 266 million euros ($289 million) for the second quarter, a significant improvement compared to a loss of 247 million euros ($268 million) during the same period last year. Monthly active users also saw a 14% increase year-over-year, reaching 626 million.
CEO Daniel Ek expressed excitement about the company’s growth, 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 the positive earnings report, Spotify’s stock jumped nearly 14% in pre-market trading on Tuesday.
This June, Spotify announced a price hike for its Premium plans in the U.S. Starting this month, the rates for individual plans will increase by $1 to $12, Duo plans will rise by $2 to $17, and Family plans will go up by $3 to $20. The previous price increase, the first in 13 years, occurred in July and averaged $1.
Notably, despite the price adjustments, Spotify added seven million net subscribers in the last quarter, surpassing its previous guidance by one million.
Spotify remains the leading audio streaming service globally, and according to a Bloomberg analysis, its users are among the least likely to cancel their subscriptions compared to other audio and video streaming platforms.
However, the company’s financial history has not always been strong. In 2022, Spotify’s stock plummeted by more than two-thirds due to multiple quarters of operating losses. This led to job cuts, with the company announcing a workforce reduction of 600 employees in January 2023, followed by a further reduction of 1,500 jobs, approximately 17% of its total staff, less than a year later.