Spotify has reported another quarter of record profits, one year after increasing the price of its Premium plans for the first time ever.
The Swedish audio streaming company posted an operating income of 266 million euros ($289 million) in the second quarter, a remarkable turnaround from a loss of 247 million euros ($268 million) in the same period last year. Monthly active users saw an annual increase of 14%, reaching 626 million.
“It’s an exciting time at Spotify. We continue to innovate and demonstrate that we’re not just a great product, but increasingly also a great business,” said CEO Daniel Ek in a statement. “We are achieving this on a timeline that has surpassed even our own expectations. This all bodes very well for the future.”
Spotify’s stock surged nearly 14% in pre-market trading on Tuesday, buoyed by the company’s impressive earnings report.
In June, Spotify announced it would raise prices for Premium users in the U.S. Starting this month, individual plans will increase by $1 to $12, Duo plans will go up by $2 to $17, and Family plans will rise by $3 to $20. Last July, the company raised membership costs for the first time in 13 years by an average of $1.
Despite these price hikes, Spotify gained seven million net subscribers in the quarter, surpassing its previous guidance by one million.
Spotify continues to be the leading audio streamer globally, with users less likely to cancel their memberships compared to any other audio or video streaming giant, according to a Bloomberg analysis.
However, Spotify’s financial journey hasn’t always been smooth. In 2022, the company’s stock lost more than two-thirds of its value amid several quarters of operating losses. In January 2023, Spotify announced plans to lay off 600 employees. Less than a year later, it further reduced its workforce by cutting 1,500 jobs, about 17% of its staff.