Spotify has announced another quarter of record profits, marking a significant turnaround since the company raised the price of its Premium plans for the first time last year. The Swedish audio streaming platform reported an operating income of 266 million euros ($289 million) for the second quarter, a notable improvement from a loss of 247 million euros ($268 million) in the same period last year. Monthly active users have also surged by 14% year-over-year, reaching 626 million.
“It’s an exciting time at Spotify. We keep innovating and proving that we’re not just a great product, but increasingly a great business,” said CEO Daniel Ek in a statement. He expressed optimism about the company’s future, noting that their progress has exceeded expectations.
Spotify’s stock jumped nearly 14% in pre-market trading on Tuesday following the release of its stronger-than-anticipated earnings report.
In June, Spotify announced a price increase for its Premium subscribers in the U.S. Starting this month, individual plan users will pay $12, up by $1, while Duo users will see an increase of $2 to $17, and Family plan costs will rise by $3 to $20. This marks the first membership price rise in 13 years, following an average increase of $1 last July.
Despite the price hikes, the company managed to add seven million net subscribers during the quarter, exceeding its previous guidance by one million.
Spotify remains the leading audio streaming service globally, with a Bloomberg analysis revealing that its users are the least likely to cancel their subscriptions compared to other major audio and video streaming platforms. However, the company has faced financial challenges in the past, with its stock plummeting over two-thirds in 2022 amid ongoing operating losses. In January 2023, Spotify announced the layoffs of 600 employees, and less than a year later, it cut 1,500 jobs, which represented about 17% of its workforce.