Spotify has announced another remarkable quarter of profits, achieving this milestone just a year after it increased the prices of its Premium subscription plans for the first time in its history.
The Swedish audio streaming service reported an operating income of 266 million euros ($289 million) for the second quarter, a significant improvement from a loss of 247 million euros ($268 million) in the same period last year. The platform saw a 14% year-over-year rise in monthly active users, reaching 626 million.
“It’s an exciting time at Spotify. We continue to innovate and demonstrate that we are not only a fantastic product, but also an increasingly viable business,” said CEO Daniel Ek in a statement. “Our progress has surpassed even our expectations. This all looks promising for the future.”
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 users in the U.S. Starting this month, individual plan users will pay an additional $1 ($12 total), those on Duo plans will see a $2 increase ($17 total), and Family plan users will pay $3 more ($20 total). This marked the first membership cost increase in 13 years, with an average rise of $1 implemented last July.
Despite the increased prices, Spotify managed to add seven million net subscribers during the quarter, exceeding its previous guidance by one million.
As the leading audio streaming service worldwide, Spotify users are less likely to cancel their subscriptions compared to other audio or video streaming platforms, according to a Bloomberg analysis.
However, Spotify’s financial journey has not always been smooth. The company’s stock lost over two-thirds of its value in 2022 due to several quarters of operating losses. Earlier this year, Spotify announced the layoffs of 600 employees and, less than a year later, cut an additional 1,500 jobs, amounting to roughly 17% of its workforce.