Spotify Shares Q2 Numbers, Record User Growth
Spotify's Q2 numbers are in, marking the streaming service's final quarter free of change as a result of its recently-announced price increase. In Q2, Spotify achieved all-time-high quarterly user growth, though not without an operating loss.
Crunch the numbers: Spotify’s global Premium Subscriber base grew to 220 million paying users in the quarter ending June 30, an increase of 17% year-over-year and 5%, or 10 million subscribers, compared to the end of Q1 2023. Its total global Monthly Active Users grew 27% year-over-year to 551 million and by 7%, or 36 million, compared to Q1, an all-time high for Spotify.
Q2 revenue of €3.18 billion was up 11% in Q2 reflecting 11% growth in subscription revenue and 12% growth in ad revenue. Heightened operating expenses were at €1.01 billion with a €247 million operating loss and €302 million net loss, which the company attributed in part to "our real estate optimization plan and severance."
Looking ahead: Spotify projects that Q3 will see a smaller number of sign-ups, with projections of adding 4 million Premium subscribers and a gain of 21 MAUs overall. On Monday, Spotify announced a price increase in the U.S. of $1, with the price of its Premium plan increasing to $10.99 per month from $9.99 per month, echoing recent increases from Apple Music, Amazon Music, and other streaming services.
Trade-off: Over at the stock market, Spotify shares saw two consecutive days of declines after the price hike announcement and the reveal of Q2's operating losses. Shares fell to their lowest level since late May on Tuesday but are still up around 80 percent this year, though down nearly 60 percent from a 2021 all-time high of almost $370. Spotify lost $5 billion in market capitalization this week and is valued at $28 billion.