Spotify has announced a record profit for the second quarter, following a price increase for its Premium plans for the first time in its history last year. The Swedish audio streaming service reported an operating income of 266 million euros (approximately $289 million), a significant turnaround from the loss of 247 million euros (around $268 million) experienced the previous year. The platform’s monthly active users also increased by 14% year-over-year, reaching 626 million.
“We are innovating and proving that we are not only a great product, but also a strong business,” stated CEO Daniel Ek. “This progress has surpassed our expectations and augurs well for our future.”
Following the positive earnings report, Spotify’s stock surged nearly 14% in pre-market trading.
In June, Spotify announced a price hike for its Premium service in the U.S., effective this month. Individual plans will now cost $12, up by $1; Duo plans will increase by $2 to $17; and Family plans will see a $3 increase, bringing them to $20. This followed an average price increase of $1 implemented last July, the company’s first in 13 years.
Despite the price adjustments, Spotify managed to gain seven million net subscribers in the quarter, surpassing its previous estimates by one million.
According to a Bloomberg analysis, Spotify remains the leading audio streaming service globally, with users being the least likely among streaming platforms to cancel their subscriptions.
However, the company’s financial history has its challenges. In 2022, Spotify shares dropped more than two-thirds of their value amid several quarters of operating losses. Early this year, the company announced the layoff of 600 employees and later cut another 1,500 jobs, accounting for about 17% of its workforce.