Spotify has achieved another quarter of record profits, marking a significant milestone a year after it increased the price of its Premium plans for the first time ever.
The Swedish audio streaming company reported an operating income of 266 million euros ($289 million) in the second quarter, a stark contrast to the loss of 247 million euros ($268 million) recorded a year ago. Monthly active users have surged 14% annually, reaching 626 million.
“It’s an exciting time at Spotify. We continue to innovate and demonstrate that we are not just a great product, but increasingly also a great business,” said CEO Daniel Ek in a statement. “We are doing so on a timeline that has exceeded even our own expectations. This all bodes very well for the future.”
Following the company’s better-than-expected earnings report, Spotify stock surged nearly 14% in pre-market trading on Tuesday.
In June, Spotify announced it would be raising prices for Premium users in the U.S. Starting this month, individual plans will see a $1 increase to $12, Duo (two-person) plans will increase by $2 to $17, and Family plans will go up by $3 to $20. This follows last July’s first price hike in 13 years, where memberships increased by an average of $1.
Despite these price hikes, Spotify added 7 million net subscribers in the quarter, surpassing its previous guidance by one million.
Spotify remains the world’s most popular audio streaming service, with users least likely to cancel their memberships compared to other audio or video streaming giants, according to a Bloomberg analysis.
However, Spotify’s financial journey hasn’t always been smooth. The company’s stock value plummeted by more than two-thirds in 2022 due to several quarters of operating losses. In January 2023, Spotify announced plans to cut 600 jobs. Less than a year later, they reduced their workforce by 1,500 jobs, accounting for roughly 17% of their staff.