Spotify has announced record profits for the second quarter, marking a significant turnaround from the previous year. The Swedish audio streaming service reported an operating income of 266 million euros ($289 million), a notable recovery from a loss of 247 million euros ($268 million) a year earlier. The company saw a 14% increase in monthly active users, bringing the total to 626 million.
CEO Daniel Ek expressed confidence in the company’s future, 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 added that the timeline for their success has exceeded their expectations.
Following the 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 plans in the U.S. Individual plan users will now pay $12 a month, up by $1, while Duo plan users will see a $2 increase to $17, and Family plan users will pay $20, an increase of $3. Last July, the company raised its subscription prices for the first time in 13 years.
Despite raising prices, Spotify added seven million net subscribers in the last quarter, surpassing previous expectations by one million.
As the leading audio streaming platform globally, Spotify users are among the least likely to cancel their subscriptions, according to a Bloomberg analysis. However, the company faced challenges in the past, with its stock losing more than two-thirds of its value in 2022 due to several quarters of operating losses. In January 2023, Spotify announced the elimination of 600 positions, and less than a year later, the company scaled down its workforce by 1,500 jobs, or about 17%.