Spotify has reported another quarter of record profits, marking a significant milestone for the Swedish audio streaming service a year after increasing the prices of its Premium plans for the first time.
In the second quarter, Spotify reported an operating income of 266 million euros ($289 million), a turnaround from a loss of 247 million euros ($268 million) during the same period last year. The platform’s monthly active users also saw a 14% increase year-over-year, reaching 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,” stated CEO Daniel Ek. He noted that the company’s progress has exceeded their own expectations, suggesting a positive outlook for the future.
Following the release of its earnings report, Spotify’s stock rose nearly 14% in pre-market trading on Tuesday.
In June, Spotify announced an increase in prices for its Premium subscriptions in the U.S. Starting this month, individual plan users will pay $1 more (bringing it to $12), while those on Duo plans will see an increase of $2 (to $17), and Family plan users will pay an additional $3 (totaling $20). This marked the first price hike in 13 years, averaging an increase of $1 across membership levels.
Despite these price hikes, Spotify successfully added seven million net subscribers during the quarter, surpassing its own projections by one million.
As the world’s leading audio streaming service, Spotify has demonstrated a lower likelihood of membership cancellations compared to other audio and video streaming platforms, according to a Bloomberg analysis.
However, the company has faced challenges in recent years, with its stock losing more than two-thirds of its value in 2022 due to several quarters of operating losses. In January 2023, Spotify announced the layoff of 600 employees, followed by a further reduction of 1,500 jobs, which accounted for approximately 17% of its workforce.