Spotify has announced record profits for another quarter, just a year after introducing its first-ever price hike for Premium subscriptions.
The Swedish audio streaming platform reported an operating income of 266 million euros ($289 million) for the second quarter, a significant turnaround from a loss of 247 million euros ($268 million) during the same period last year. The company also saw a 14% increase in monthly active users, reaching 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,” stated CEO Daniel Ek. “We are doing so on a timeline that has exceeded even our own expectations, which bodes well for the future.”
Following the positive earnings report, Spotify’s stock rose nearly 14% in pre-market trading on Tuesday.
In June, Spotify informed its U.S. users about an increase in Premium subscription prices, effective this month. Individual plans will see a $1 hike to $12, Duo plans will rise by $2 to $17, and Family plans will increase by $3 to $20. This price adjustment follows last July’s first membership cost increase in 13 years, which averaged around $1.
Despite these increases, Spotify managed to add seven million net subscribers in the quarter, surpassing its previous guidance by one million.
Spotify remains the top audio streaming service globally, with a Bloomberg analysis indicating its users are the least likely among audio or video streaming platforms to cancel their subscriptions.
However, the company’s financial journey has had its challenges. In 2022, Spotify’s stock plunged more than two-thirds of its value, leading to multiple quarters of operating losses. In early 2023, the company announced layoffs of 600 employees, followed by another cut of 1,500 jobs, which amounted to approximately 17% of its workforce.