Spotify has announced another quarter of record profits, achieving this milestone a year after raising the prices of its Premium plans for the first time in its history.
The Swedish audio streaming giant posted an operating income of 266 million euros ($289 million) for the second quarter, in contrast to a loss of 247 million euros ($268 million) in the same period last year. The platform also reported a 14% annual increase in monthly active users, reaching a total of 626 million.
CEO Daniel Ek expressed optimism, stating, “It’s an exciting time at Spotify. We keep innovating and demonstrating that we are not just a great product but also increasingly a great business. We are achieving this on a timeline that has surpassed our expectations, which bodes well for the future.”
Following the upbeat earnings report, Spotify’s stock surged nearly 14% in pre-market trading on Tuesday.
In June, Spotify announced price hikes for its Premium users in the U.S. Starting this month, individual plan users will see an increase of $1, bringing their monthly fee to $12. Duo plans (for two people) will see a $2 increase to $17, and Family plans will rise by $3, totaling $20. This marked the first membership cost increase in 13 years.
Despite these price adjustments, Spotify managed to add seven million net subscribers during the quarter, surpassing its previous guidance by one million.
As the leading audio streaming service globally, Spotify users are the least likely to cancel their subscriptions compared to other audio and video streaming platforms, according to a Bloomberg analysis.
However, the company has not always enjoyed financial success. In 2022, Spotify’s stock plummeted by more than two-thirds while it grappled with several quarters of operating losses. In January 2023, the company announced layoffs affecting 600 employees. Less than a year later, it cut 1,500 jobs, amounting to approximately 17% of its workforce.