Spotify has announced another quarter of record profits, just a year after implementing its first price increase for Premium plans.
The Swedish audio streaming platform reported an operating income of 266 million euros ($289 million) in the second quarter, recovering from a loss of 247 million euros ($268 million) during the same period last year. Monthly active users also grew by 14% year-over-year, reaching 626 million.
CEO Daniel Ek expressed enthusiasm about the company’s trajectory, 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. We are doing so on a timeline that has exceeded even our own expectations. This all bodes very well for the future.”
Following the release of this positive earnings report, Spotify’s stock rose nearly 14% in pre-market trading on Tuesday.
In June, Spotify announced a price increase for its Premium users in the U.S. Starting this month, individual plans will cost $12, an increase of $1; Duo plans will rise by $2 to $17; and Family plans will see a $3 increase to $20. This marks the first membership cost increase in 13 years.
Despite the price hikes, Spotify managed to add seven million net subscribers in the quarter, exceeding its forecast by one million.
Spotify remains the leading audio streaming service globally, with its users less likely to cancel their subscriptions compared to other audio or video streaming platforms, as per a Bloomberg analysis.
However, Spotify has faced financial challenges in the past. The company witnessed its stock value decline by over two-thirds in 2022 due to several quarters of operating losses. In January 2023, Spotify announced layoffs of 600 employees, and less than a year later, it cut another 1,500 jobs, accounting for about 17% of its workforce.