Spotify has reported another quarter of record profits, marking a year since it raised the prices of its Premium plans for the first time in history.
The Swedish audio streaming giant announced 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 increased, soaring 14% year-over-year to reach 626 million.
“This is an exciting time for Spotify. We continue to innovate, proving that we are not just a fantastic product, but increasingly a robust business,” CEO Daniel Ek stated. “Our achievements have surpassed even our expectations, which is promising for our future.”
On the heels of this impressive earnings report, Spotify’s stock surged nearly 14% in pre-market trading on Tuesday.
In June, Spotify announced price hikes for its Premium users in the U.S. Beginning this month, individual plan users will pay $1 more, bringing their total to $12. Duo plan users will see a $2 increase to $17, while Family plan users will pay $3 more, making it $20. This past July, Spotify had already raised membership prices for the first time in 13 years by an average of $1.
Despite the price increases, Spotify managed to add seven million net subscribers during the quarter, exceeding its earlier guidance by one million.
Recognized as the leading audio streaming service globally, Spotify users are noted to be less likely than those of any other audio or video streaming platform to cancel their subscriptions, according to a Bloomberg analysis.
However, Spotify’s financial journey has seen its ups and downs. In 2022, the company’s stock value plummeted by more than two-thirds as it contended with multiple quarters of operating losses. In early 2023, Spotify announced its intention to reduce its workforce by 600 employees, and less than a year later, it made deeper cuts, eliminating 1,500 jobs, approximately 17% of its workforce.