Spotify has reported a record profit for the second quarter, marking a significant turnaround from the previous year. The Swedish audio streaming platform achieved an operating income of 266 million euros ($289 million), compared to a loss of 247 million euros ($268 million) last year. Additionally, the company saw a 14% increase in monthly active users, reaching 626 million.
CEO Daniel Ek expressed enthusiasm about the company’s growth, 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.
In June, Spotify announced a price increase for its Premium users in the U.S. Starting this month, individual plans rose by $1 to $12, Duo plans increased by $2 to $17, and Family plans went up by $3 to $20. This price adjustment follows the first membership cost hike in 13 years, which took place in July 2022.
Despite the price hikes, Spotify managed to add seven million net subscribers during the quarter, exceeding its own forecasts by one million.
Spotify remains the leading audio streaming service globally, with a Bloomberg analysis indicating that its users are the least likely to cancel their memberships compared to other audio and video streaming platforms. However, the company’s financial history has been turbulent, as it lost more than two-thirds of its stock value in 2022 due to consecutive quarters of operating losses. In early 2023, Spotify announced the layoff of 600 employees, and less than a year later, it cut an additional 1,500 jobs, roughly 17% of its workforce.