Spotify has announced a record profit for the second quarter, following its first-ever price increase for Premium plans last year. The Swedish audio streaming service reported an operating income of 266 million euros ($289 million), a significant turnaround from a loss of 247 million euros ($268 million) during the same period last year. The platform also saw a 14% increase in monthly active users, reaching 626 million.
CEO Daniel Ek expressed optimism 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.” He noted that the growth trajectory has been beyond their expectations, which is promising for the company’s future.
Following the release of its earnings report, Spotify’s stock surged nearly 14% in pre-market trading.
In June, Spotify announced price increases for Premium users in the U.S. Starting this month, individual plan subscribers will now pay $12, an increase of $1, while Duo plans will rise by $2 to $17 and Family plans by $3 to $20. This marked the first price adjustment in 13 years, when the company increased membership costs by an average of $1.
Despite these hikes, Spotify added seven million net subscribers in the past quarter, exceeding its earlier guidance by one million.
Spotify remains the leading audio streaming platform globally, with a Bloomberg analysis indicating that its users are the least likely to cancel their subscriptions compared to other audio or video streaming services. However, the company faced challenges in 2022, resulting in a drastic decrease in its stock value and significant layoffs, including 600 employees in January and 1,500 jobs, or about 17% of its workforce, less than a year later.