Spotify has announced another record-breaking quarter of profits, just a year after implementing its first-ever price increase for Premium subscriptions.
The Swedish audio streaming platform reported an operating income of 266 million euros ($289 million) for the second quarter, a significant turnaround from the 247 million euro ($268 million) loss recorded during the same period last year. The company also saw its monthly active users rise by 14% year-over-year, reaching 626 million.
CEO Daniel Ek expressed enthusiasm regarding the company’s progress, 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 positive earnings report, Spotify’s stock surged nearly 14% in pre-market trading on Tuesday.
In June, Spotify announced price increases for Premium subscriptions in the U.S. Starting this month, individuals on the individual plan will pay $12, an increase of $1, while Duo plans will rise by $2 to $17, and Family plans will see a $3 increase, totaling $20. This price hike followed a previous adjustment last July, which marked the first increase in 13 years, averaging $1.
Notably, despite these hikes, Spotify managed to add seven million net subscribers in the quarter, exceeding its initial projections by one million.
As the world’s leading audio streaming service, Spotify users are reportedly the least likely among audio and video streaming platforms to cancel their subscriptions, according to a Bloomberg analysis.
However, Spotify’s financial journey has not always been smooth. In 2022, the company’s stock lost more than two-thirds of its value due to several quarters of operating losses. In January 2023, Spotify announced a plan to reduce its workforce by 600 employees, and less than a year later, further cuts amounted to 1,500 jobs, or approximately 17% of its total staff.