Spotify has announced another quarter of record profits, a year after increasing the prices of its Premium plans for the first time. The Swedish audio streaming giant posted an operating income of 266 million euros ($289 million) for the second quarter, a significant recovery from a loss of 247 million euros ($268 million) in the same period last year. The platform also experienced a 14% annual increase in monthly active users, reaching 626 million.
CEO Daniel Ek expressed enthusiasm about the company’s progress, 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 rose nearly 14% in pre-market trading on Tuesday.
In June, Spotify announced a price hike for Premium users in the U.S., which took effect this month. Individual plan users will see an increase of $1 to $12, Duo plan users will pay $2 more at $17, and Family plan users will face a $3 increase to $20. This followed a membership price increase last July for the first time in 13 years, averaging an additional $1.
Despite these price adjustments, Spotify successfully added seven million net subscribers during the quarter, exceeding its guidance by one million.
According to a Bloomberg analysis, Spotify is the world’s leading audio streaming service, with its users exhibiting the lowest likelihood of canceling their subscriptions compared to other audio or video streaming platforms.
However, the company’s financial history reflects challenges, having lost more than two-thirds of its stock value in 2022 amid multiple quarters of operating losses. In January 2023, Spotify announced the layoff of 600 employees, followed by another reduction of 1,500 jobs, which amounted to roughly 17% of its workforce, less than a year later.