Spotify has announced a record profit for the second quarter, marking a significant turnaround from the previous year’s losses. The Swedish audio streaming giant reported an operating income of 266 million euros ($289 million) for the quarter, a remarkable increase compared to a loss of 247 million euros ($268 million) a year ago. The platform also saw its monthly active users rise by 14% year-over-year, reaching 626 million.
CEO Daniel Ek expressed enthusiasm about the company’s progress, 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. This all bodes very well for the future.”
Following the earnings report, Spotify’s stock jumped nearly 14% in pre-market trading on Tuesday.
In June, Spotify announced a price increase for its Premium users in the U.S., effective from this month. Individual plan subscribers will see their fees rise by $1 to $12, Duo plan users will pay $2 more, bringing their total to $17, and Family plan subscribers will incur a $3 increase, leading to a new cost of $20. This marks the first price hike in 13 years for the streaming service.
Despite these increases, Spotify successfully gained seven million net subscribers in the quarter, exceeding its earlier expectations by one million.
According to a Bloomberg analysis, Spotify remains the leading audio streaming service globally, with its users being the least likely to cancel their subscriptions compared to other audio or video streaming platforms.
However, the company has faced challenges in the past. In 2022, Spotify’s stock lost more than two-thirds of its value amid several quarters of operating losses. In January 2023, the company announced it would lay off 600 employees, followed by an additional 1,500 job cuts less than a year later, which accounted for about 17% of its workforce.