Spotify has announced another quarter of record profits, following a price increase for its Premium plans implemented last year for the first time. The Swedish audio streaming service 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. Monthly active users grew by 14% year-over-year, reaching 626 million.
CEO Daniel Ek expressed enthusiasm in a statement, highlighting the company’s commitment to innovation and positioning itself as a robust business. He noted that recent developments have surpassed even the company’s expectations, suggesting a positive outlook for the future.
Following the earnings report, Spotify’s stock experienced a surge of nearly 14% in pre-market trading.
In June, Spotify announced a price increase for its Premium users in the United States, effective this month. Individual plans are now priced at $12, reflecting a $1 increase, while Duo plans rose by $2 to $17, and Family plans saw a $3 increase to $20. This marked the first membership cost increase in 13 years.
Despite the price hikes, Spotify added seven million net subscribers during the quarter, exceeding its previous forecast by one million. The company remains the leading audio streaming platform globally, with users displaying the least tendency to cancel subscriptions compared to other streaming services, according to a Bloomberg analysis.
However, Spotify’s financial journey has not always been smooth. In 2022, the company’s stock value plummeted by more than two-thirds amid several quarters of operating losses. In early 2023, it announced a layoff of 600 employees, followed by another reduction of 1,500 jobs, amounting to roughly 17% of its workforce, less than a year later.