Spotify has announced another quarter of record profits, marking a year since it first raised the prices of its Premium subscription plans. The Swedish audio streaming platform reported an operating income of 266 million euros ($289 million) for the second quarter, a significant improvement from a loss of 247 million euros ($268 million) during the same period last year. The company also saw a 14% year-on-year increase in monthly active users, reaching 626 million.
CEO Daniel Ek expressed optimism about the company’s growth, stating, “It’s an exciting time at Spotify. We keep on innovating and showing that we aren’t just a great product, but increasingly a great business. We are doing so on a timeline that has exceeded even our own expectations.”
Following the positive earnings report, Spotify’s stock surged nearly 14% in pre-market trading. In June, the company announced price hikes for its Premium plans in the U.S. starting this month, with individual plans increasing by $1 to $12, Duo plans by $2 to $17, and Family plans by $3 to $20. This marked the first price increase in 13 years, which had been raised by an average of $1 last July.
Despite these increases, Spotify successfully added seven million net subscribers in the latest quarter, surpassing its previous guidance by one million. The platform retains its position as the world’s leading audio streaming service, with users showing a lower likelihood of cancelling their subscriptions compared to competitors, according to a Bloomberg analysis.
However, the company’s financial journey has not always been smooth. Spotify’s stock fell by more than two-thirds in 2022 due to several quarters of operating losses. In January 2023, the company announced it would reduce its workforce by 600 employees, and less than a year later, it cut an additional 1,500 jobs, amounting to approximately 17% of its staff.