Spotify has announced a record profit for the second quarter, marking a significant turnaround from a loss in the same period last year following its first price hike for Premium plans. The Swedish audio streaming giant reported an operating income of 266 million euros ($289 million), compared to a loss of 247 million euros ($268 million) a year prior. Additionally, the company’s monthly active users increased by 14% year-over-year, reaching 626 million.
CEO Daniel Ek expressed enthusiasm for 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. This all bodes very well for the future.”
In response to the positive earnings report, Spotify stock surged almost 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 plan subscribers will see a $1 increase to $12, Duo plan users will pay $2 more at $17, and Family plan users will see a $3 rise to $20. This marked the first increase in membership costs in 13 years, which had previously averaged an additional $1.
Despite the price hikes, Spotify added seven million net users in the quarter, exceeding its own forecasts by one million. The platform remains the most popular audio streaming service globally and has proven resilient, with subscribers being less likely to cancel their memberships compared to competitors, according to a Bloomberg analysis.
However, the company has not always enjoyed positive financial outcomes. In 2022, Spotify’s stock lost over two-thirds of its value amid several quarters of operating losses. Earlier this year, the company announced layoffs affecting 600 employees and then further cut 1,500 jobs, representing about 17% of its workforce.