Spotify has achieved another quarter of record profits just a year after implementing its first-ever price increase for Premium plans. The Swedish audio streaming giant reported an operating income of 266 million euros ($289 million) for the second quarter, a significant improvement compared to a loss of 247 million euros ($268 million) during the same period last year. Monthly active users surged by 14% year-on-year, reaching 626 million.
“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,” stated CEO Daniel Ek. “We are doing so on a timeline that has exceeded even our own expectations, which bodes very well for the future.”
Following this positive earnings report, Spotify’s stock rose nearly 14% in pre-market trading on Tuesday.
In June, Spotify announced a price hike for its Premium users in the U.S., effective this month. Individual plan subscribers will see their fees rise by $1 to $12, Duo plan subscribers will pay $2 more, totaling $17, and Family plan subscribers will face a $3 increase, bringing their total to $20. The previous year marked the first price increase in 13 years, averaging an additional $1.
Despite the price adjustments, Spotify added seven million net subscribers during the quarter, exceeding its earlier projections by one million.
Spotify remains the world’s leading audio streaming service, with its users demonstrating the lowest likelihood of canceling subscriptions compared to other major audio and video streaming platforms, according to a Bloomberg analysis.
However, the company’s financial journey has not always been smooth; Spotify’s stock suffered a decline of more than two-thirds in value throughout 2022 as it experienced several quarters of operating losses. In January 2023, the company announced the reduction of 600 jobs, and less than a year later, it cut 1,500 positions, representing about 17% of its workforce.