Spotify has reported another record-breaking quarter, achieving an operating income of 266 million euros ($289 million) in the second quarter, a significant turnaround from a loss of 247 million euros ($268 million) during the same period last year. Additionally, the streaming platform saw 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 surged nearly 14% in pre-market trading on Tuesday.
In June, Spotify announced price hikes for its Premium services in the U.S. Starting this month, individual plan users will see an increase of $1 to $12, Duo plan users will pay an additional $2, bringing their total to $17, and Family plan users will incur a $3 increase, now costing $20. This marked the first price increase in 13 years, with a previous average increase of $1 noted last July.
Despite the price hikes, Spotify added seven million net subscribers in the quarter, exceeding its previous forecast by one million.
As the leading audio streaming service globally, Spotify users are reportedly the least likely to cancel their subscriptions compared to other streaming platforms, 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 amid several quarters of operating losses. Early in 2023, the company announced the layoffs of 600 employees, followed by a further reduction of 1,500 jobs, accounting for about 17% of its workforce less than a year later.