Spotify has announced a record profit for the second consecutive quarter, following its first-ever increase in Premium subscription prices last year.
In the latest report, the Swedish audio streaming service recorded 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 number of monthly active users surged by 14% year-on-year, reaching 626 million.
CEO Daniel Ek expressed enthusiasm 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 these positive earnings results, Spotify’s stock rose nearly 14% in pre-market trading on Tuesday.
In June, the company announced a price hike for Premium users in the United States, effective this month. Individual plan users will see a $1 increase to $12, Duo plan subscribers will pay $2 more at $17, and Family plan users will face a $3 increase to $20. Last July marked the first membership cost increase in 13 years, with an average rise of $1.
Notably, despite the price hikes, Spotify managed to gain seven million new net subscribers during the quarter, surpassing its previous guidance by one million.
As the leading audio streaming platform globally, Spotify users are also the least likely to cancel subscriptions compared to other audio or video streaming services, according to a Bloomberg analysis.
However, the company has faced challenges in the past. In 2022, Spotify’s stock value plummeted by more than two-thirds as it struggled with several quarters of operating losses. Earlier this year, the company announced layoffs affecting 600 employees, followed by further reductions of approximately 1,500 jobs—around 17% of its workforce—less than a year later.