Spotify has announced another record profit quarter just a year after increasing prices for its Premium plans for the first time. The Swedish audio streaming platform reported an operating income of 266 million euros ($289 million) for the second quarter, reversing a loss of 247 million euros ($268 million) from the same period last year. The company also saw a 14% year-over-year growth in monthly active users, totaling 626 million.
CEO Daniel Ek expressed his enthusiasm for the company’s trajectory, 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.” He noted that their progress has exceeded expectations, indicating positive prospects for the future.
Following this promising earnings report, Spotify’s stock surged nearly 14% in pre-market trading on Tuesday.
In June, Spotify announced a price hike for its Premium users in the United States. Starting this month, individual plan users will see an increase of $1, bringing the total to $12, while Duo (two-person) plans will rise by $2 to $17, and Family plans will increase by $3 to $20. This past July, the company raised membership prices for the first time in 13 years by an average of $1.
Despite these increases, Spotify successfully added seven million net subscribers in the quarter, exceeding their previous guidance by one million. Additionally, a Bloomberg analysis found that Spotify is the most widely used audio streaming service globally, with its users being the least likely to cancel their subscriptions compared to other streaming platforms.
However, the company has not always experienced financial success. In 2022, Spotify’s stock lost over two-thirds of its value due to consecutive quarters of operating losses. In January 2023, the company announced plans to reduce its workforce by 600 employees, and less than a year later, it cut approximately 1,500 jobs, equating to about 17% of its total staff.