Spotify has announced another quarter of record profits, marking one year since the company increased the price of its Premium subscription plans for the first time.
The Swedish audio streaming platform reported 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) the previous year. Monthly active users also saw a 14% increase year-over-year, reaching a total of 626 million.
“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,” said CEO Daniel Ek in a statement. He noted that the company is progressing faster than expected, which is promising for the future.
Following the better-than-anticipated earnings report, Spotify’s stock surged nearly 14% in pre-market trading on Tuesday.
In June, Spotify announced that it would be raising prices for its U.S. Premium users. Starting this month, individual plan subscribers will pay an additional $1, bringing the total to $12, while Duo (two-person) plans will increase by $2 to $17, and Family plans will rise by $3 to $20. This price increase marked the first adjustment in membership costs in 13 years.
Despite the hikes, Spotify managed to add seven million net subscribers during the quarter, surpassing its previous guidance by one million.
As the leading audio streaming service globally, Spotify users are the least likely to cancel their subscriptions compared to users of other audio or video platforms, according to a Bloomberg analysis.
However, the company has faced financial struggles in the past. Spotify’s stock plummeted more than two-thirds in 2022 amid several quarters of operating losses. In January 2023, the company announced a reduction of 600 employees, followed by another cut of 1,500 jobs, accounting for roughly 17% of its workforce.