Spotify has announced another record profit for the second quarter, marking a significant turnaround from a year ago. The Swedish audio streaming service reported an operating income of 266 million euros ($289 million), a stark contrast to a loss of 247 million euros ($268 million) in the same quarter last year. The company also saw its monthly active users rise by 14% year-over-year, reaching 626 million.
CEO Daniel Ek expressed optimism about the company’s performance, 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 company’s positive earnings report, Spotify’s stock surged nearly 14% in pre-market trading on Tuesday.
In June, Spotify announced a price increase for its Premium service in the U.S., starting this month. Individual plan users will see their monthly fee rise by $1 to $12, while Duo plans will increase by $2 to $17, and Family plans will cost $3 more, reaching $20. This was the company’s first price increase in 13 years, and despite the adjustments, Spotify added seven million net subscribers during the quarter, exceeding its previous guidance by one million.
Spotify remains the leading audio streaming service globally, and analysis from Bloomberg indicates that its users are less likely to cancel their subscriptions compared to those of other audio and video streaming platforms.
However, the company has faced challenges in the past. In 2022, Spotify’s stock experienced a significant decline, losing over two-thirds of its value amid several quarters of operating losses. In January 2023, Spotify announced layoffs of 600 employees, followed by another round in less than a year that affected 1,500 jobs, approximately 17% of its workforce.