Spotify has reported another record profit quarter, marking a year since it first increased the prices of its Premium plans.
The Swedish audio streaming platform announced an operating income of 266 million euros ($289 million) for the second quarter, in contrast to a loss of 247 million euros ($268 million) during the same period last year. Monthly active users surged by 14% year-over-year, reaching 626 million.
CEO Daniel Ek expressed enthusiasm, 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.
In June, the company announced price hikes for its Premium services in the U.S. Beginning this month, individual plan users will see a $1 increase to $12, Duo plan users will pay $2 more for a total of $17, and Family plan members will incur a $3 increase, costing $20. This change follows an average price raise of $1 in July of the previous year, which was the first increase in 13 years.
Despite the increased subscription costs, Spotify successfully added seven million net subscribers in the quarter, exceeding its earlier forecast by one million.
As the leading audio streaming service globally, Spotify users tend to be less likely than those of other streaming platforms to cancel their subscriptions, according to a Bloomberg analysis.
However, the company has faced financial challenges in the past. In 2022, Spotify’s stock plummeted by more than two-thirds, resulting in multiple quarters of operating losses. In early 2023, the company announced the reduction of 600 jobs, and less than a year later, it eliminated 1,500 positions, accounting for about 17% of its workforce.