Spotify has reported record profits for the second quarter, marking a significant turnaround from a year ago when it faced substantial losses. The Swedish audio streaming service announced an operating income of 266 million euros ($289 million), a notable improvement compared to a loss of 247 million euros ($268 million) during the same period last year. Additionally, the platform saw a 14% year-over-year increase in monthly active users, reaching 626 million.
CEO Daniel Ek expressed enthusiasm about the company’s trajectory, highlighting ongoing innovations that reinforce Spotify’s position as both a leading product and a successful business. Following the positive earnings report, Spotify’s stock surged nearly 14% in pre-market trading.
In June, Spotify revealed an increase in subscription prices for Premium users in the U.S., which took effect this month. Individual plan users will pay an extra $1, bringing the total to $12, while Duo plan users will see a $2 increase to $17, and Family plan users will pay $3 more for a total of $20. This price adjustment followed a similar membership cost raise last July, which was the first in 13 years.
Despite these increases, Spotify managed to gain seven million net subscribers in the quarter, exceeding its previous guidance by one million. A Bloomberg analysis indicates that Spotify is the world’s most popular audio streaming service, with its users being the least likely to cancel their memberships compared to other streaming giants.
The journey has not been without challenges; Spotify stock lost over two-thirds of its value in 2022 as the company grappled with consecutive quarters of operating losses. In January 2023, the company laid off 600 employees, followed by an even larger cut of 1,500 jobs—approximately 17% of its workforce—less than a year later.