Spotify has announced record profits for the second quarter, marking a significant turnaround from the previous year. The Swedish audio streaming giant reported an operating income of 266 million euros (approximately $289 million), compared to a loss of 247 million euros ($268 million) in the same quarter last year. The company also experienced a 14% year-over-year increase in monthly active users, reaching 626 million.
CEO Daniel Ek expressed enthusiasm about 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.”
Following the release of its earnings report, Spotify’s stock surged nearly 14% in pre-market trading.
In June, Spotify announced plans to increase prices for its Premium subscription plans in the U.S. Starting this month, individual plan users will see an increase of $1, bringing their total to $12, while Duo plans will rise by $2 to $17, and Family plans will increase by $3 to $20. This price hike was the first in 13 years and came after a previous average increase of $1 last July. Despite these adjustments, the company welcomed seven million new subscribers during the quarter, exceeding earlier expectations by one million.
Spotify remains the leading audio streaming service globally and has been identified as having the lowest cancellation rate among major audio and video streaming platforms, according to a Bloomberg analysis. However, the company has faced challenges in the past, with its stock losing over two-thirds of its value in 2022 due to several quarters of operational losses. In early 2023, Spotify announced layoffs affecting 600 employees, and less than a year later, it cut an additional 1,500 jobs, accounting for around 17% of its workforce.