Spotify has announced another quarter of record profits, marking a significant turnaround since it raised its Premium subscription prices for the first time last year.
The Swedish audio streaming platform reported an operating income of 266 million euros (approximately $289 million) for the second quarter, compared to a loss of 247 million euros ($268 million) during the same period last year. Monthly active users rose by 14% 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. He expressed enthusiasm about the company’s progress, stating that the timeline of achievements has exceeded their own expectations, which is promising for the future.
Following the earnings report, Spotify’s stock surged nearly 14% in pre-market trading on Tuesday.
In June, Spotify announced new price increases for Premium users in the U.S. Starting this month, individual plans will increase by $1 to $12, Duo plans will rise by $2 to $17, and Family plans will go up by $3 to $20. This follows a price hike last July, which was the first adjustment in 13 years, averaging an increase of $1.
Despite these price hikes, Spotify managed to gain seven million net subscribers in the last quarter, exceeding its prior guidance by one million.
According to a recent analysis by Bloomberg, Spotify remains the leading audio streaming service worldwide and has the lowest membership cancellation rates among audio and video streaming platforms.
However, the company has faced financial challenges in the past. In 2022, Spotify’s stock fell by more than two-thirds amid ongoing operating losses. Earlier this year, the company announced a workforce reduction of 600 employees, followed by an additional cut of 1,500 positions, which represents about 17% of its total staff.