Spotify has reported record profits for another quarter, marking a significant turnaround since it raised prices on its Premium plans for the first time last year.
In the second quarter, the Swedish audio streaming platform logged an operating income of 266 million euros ($289 million), a stark contrast to the loss of 247 million euros ($268 million) recorded during the same period last year. The platform also saw a 14% increase in monthly active users, reaching 626 million.
CEO Daniel Ek expressed enthusiasm about the company’s ongoing innovations and robust business performance, stating that the results have exceeded expectations and indicate a promising future for Spotify.
Following the release of its earnings report, Spotify’s stock surged nearly 14% in pre-market trading.
In June, Spotify announced price hikes for its Premium subscription plans in the U.S., effective this month. Individual plan users will see a $1 increase to $12, Duo plan subscribers will pay $2 more (now $17), and Family plan members will incur an additional $3, bringing the total to $20. The previous average price increase last July was the first in 13 years.
Amid these increases, Spotify managed to add seven million net subscribers during the quarter, exceeding its projections by one million.
As the leading audio streaming service globally, Spotify users are reportedly the least likely among streaming services to cancel their subscriptions, according to a Bloomberg analysis.
However, the company has faced challenges in the past. Spotify’s stock plummeted over two-thirds in value during 2022 due to several quarters of operating losses. Earlier this year, the company announced layoffs affecting 600 employees, followed by another reduction of 1,500 jobs, accounting for approximately 17% of its workforce.