Spotify has announced another record profit quarter, a year after the company increased the prices of its Premium subscription plans for the first time.
The Swedish audio streaming service recorded an operating income of 266 million euros ($289 million) in the second quarter, a notable turnaround from a loss of 247 million euros ($268 million) in the same period last year. Its monthly active user base grew by 14% year-over-year, reaching 626 million users.
Spotify CEO Daniel Ek expressed optimism about the company’s trajectory, stating, “It’s an exciting time at Spotify. We continue to innovate and demonstrate that we aren’t just a great product, but increasingly also a robust business. Our progress is outpacing even our own expectations, which is promising for the future.”
Following the earnings report, Spotify’s stock surged nearly 14% in pre-market trading on Tuesday.
In June, Spotify announced an increase in subscription fees for its Premium users in the U.S. Starting this month, individual plan subscribers will see a $1 hike to $12, Duo plan subscribers will pay $2 more at $17, and Family plan subscribers will face a $3 increase to $20. This follows an average price increase of $1 last July, marking the first hike in 13 years.
Despite these price adjustments, Spotify successfully added seven million net subscribers during the quarter, surpassing its earlier projections by one million.
As the leading audio streaming platform globally, Spotify users are reportedly the least likely among various streaming services to cancel their subscriptions, according to a Bloomberg analysis.
However, the company has faced financial challenges in the past. In 2022, Spotify’s stock value more than halved due to several quarters of operating losses. In January 2023, the company announced the layoff of 600 employees, and by the end of the following year, it had reduced its workforce by approximately 1,500 jobs, equating to around 17% of its total staff.