Spotify has reported a record profit for the second quarter, marking a significant turnaround from a year ago. The company achieved an operating income of 266 million euros ($289 million), compared to a loss of 247 million euros ($268 million) in the previous year. Monthly active users increased by 14% year-over-year, 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 positive earnings report, Spotify’s stock surged nearly 14% in pre-market trading.
In June, the company announced a price increase for its Premium plans in the U.S., effective this month. Individual plan subscribers will see a $1 increase to $12, Duo plan users will see a $2 increase to $17, and Family plan users will pay $3 more, bringing the total to $20. This marked the first price hike for membership in 13 years, with the previous increase occurring last July.
Despite raising prices, Spotify added seven million net subscribers in the quarter, exceeding its earlier projections by one million. A Bloomberg analysis has shown that Spotify holds the title of the most popular audio streaming platform globally and has the lowest cancellation rates among major audio and video streaming services.
However, Spotify has faced financial challenges in the past. The company’s stock fell by more than two-thirds in 2022 due to several quarters of operating losses. In January 2023, Spotify announced the layoff of 600 employees, and less than a year later, it cut an additional 1,500 jobs, roughly 17% of its workforce.