After nearly seventeen years of consistent losses, Spotify has marked a significant turnaround by reporting profits for the second consecutive quarter. The recent price increases and corporate restructuring efforts appear to be paying off.
Spotify now boasts a global user base of 626 million, an increase of 75 million listeners compared to the first quarter of the previous year. The number of premium subscribers, who provide a higher revenue per user, has risen from 220 million to 246 million during this period.
Thanks to last summer’s price hikes, Spotify now earns an average of €13.62 per user each quarter, up from €12.60 the previous year. In the past three months alone, subscribers have generated over €3.3 billion in revenue for the music service. Additionally, advertising revenue reached €456 million.
Non-subscribers can listen to music for free on Spotify, interspersed with advertisements. This model yielded an average of €1.16 per listener in the last quarter.
Spotify’s total revenue for the recent quarter exceeded €3.8 billion, a 20% increase over the same period last year. Net profit for the company was €266 million, marking the highest profit in the company’s history. By comparison, Spotify incurred a loss of €247 million in the second quarter of 2023.
To date, profitable quarters have been rare for Spotify, which has been operational for over seventeen years. The company has only occasionally reported profits during this extended period.