Spotify has announced another quarter of record profits, marking one year since it increased the prices of its Premium plans for the first time.
The Swedish audio streaming giant reported an operating income of 266 million euros ($289 million) in the second quarter, bouncing back from a loss of 247 million euros ($268 million) in the same period last year. The number of monthly active users rose by 14% year-over-year to 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,” CEO Daniel Ek stated. He added that the company is surpassing even its own expectations, which paints a positive picture for the future.
Following the optimistic earnings report, Spotify’s stock surged nearly 14% in pre-market trading on Tuesday.
In June, Spotify announced a price increase for its Premium users in the U.S. Starting this month, individual plan users will pay an additional $1, bringing the total to $12. Duo (two-person) plans will see a $2 increase to $17, while Family plans will rise by $3 to $20. Last July marked the first increase in membership costs in 13 years, averaging $1.
Despite these price hikes, Spotify managed to add seven million net subscribers during the quarter, exceeding its previous guidance by one million.
As the world’s leading audio streaming platform, Spotify users are the least likely to cancel their subscriptions compared to other audio or video streaming services, according to a Bloomberg analysis.
However, the company has faced significant challenges in recent years. In 2022, Spotify’s stock value plummeted by over two-thirds as it reported several quarters of operating losses. In January 2023, the company announced a reduction of 600 positions and followed this with a more substantial cut of 1,500 jobs, approximately 17% of its workforce, less than a year later.