Current:Home > FinanceSpotify hikes price of memberships as it seeks to drive profits -Streamline Finance
Spotify hikes price of memberships as it seeks to drive profits
View
Date:2025-04-17 13:40:38
Spotify subscriptions will become a little more expensive next month as the audio streaming service plans to raise its membership prices for the second time in less than a year.
Starting in July month, Spotify's individual plan will jump $1 to $11.99 a month and its Duo plan will increase $2 to $16.99 a month. The family plan will increase $3 to $19.99 while the student plan will remain $5.99 a month.
The increase will help it "continue to invest in and innovate on our product features and bring users the best experience," Spotify said in a statement Monday.
The increase comes after Spotify in April reported a record profit of $183 million for the first quarter of 2024 after growing its monthly subscribers to 615 million, up from 515 million the year prior. During an earnings call with analysts, CEO Daniel Ek said the company is focusing less on gaining subscribers and concentrating more on revenue growth.
"Next year, our focus may return to top-of-the-funnel user growth but in the near term, monetization remains our top priority," Ek said.
The Stockholm, Sweden-based company was founded in 2006 but has struggled to consistently turn a profit since going public in 2018. The company posted an operating loss of $81.6 million in the fourth quarter of 2023. The company raised its prices around the same time a year ago in a move it said at the time would help "deliver value to fans and artists."
During the same earnings call, Spotify's interim Chief Financial Officer Ben Kung said "our data shows that historical price increases have had minimal impacts on growth."
Spotify laid off hundreds of employees after overhiring during the pandemic. The company had taken advantage of lower borrowing rates between 2020 and 2021 and financed an expansion, investing heavily in employees, content and marketing, Spotify said in a December blog post.
But the company in 2023 implemented three rounds of job cuts, beginning in January of last year, when the company slashed 6% of jobs, bringing its workforce to 9,200 employees. Just four months later, it cut another 2%, or 200 employees, mostly in its podcasting division. Spotify let go another 1,500 in December 2023.
Spotify also hiked prices this year in Australia, Pakistan and the United Kingdom. Its stock price rose 4.5% in midday trading to $310 a share.
- In:
- Spotify
- Music
- Live Streaming
Khristopher J. Brooks is a reporter for CBS MoneyWatch. He previously worked as a reporter for the Omaha World-Herald, Newsday and the Florida Times-Union. His reporting primarily focuses on the U.S. housing market, the business of sports and bankruptcy.
TwitterveryGood! (9197)
Related
- Newly elected West Virginia lawmaker arrested and accused of making terroristic threats
- NFL Week 1 injury report: Updates on Justin Herbert, Hollywood Brown, more
- Florida State upset by Boston College at home, Seminoles fall to 0-2 to start season
- Ben Affleck's Cousin Declares She's the New Jenny From the Block Amid Jennifer Lopez Divorce
- A Georgia governor’s latest work after politics: a children’s book on his cats ‘Veto’ and ‘Bill’
- Elle Macpherson Details “Daunting” Private Battle With Breast Cancer
- Gymnast Kara Welsh’s Coaches and Teammates Mourn Her Death
- Nation's largest Black Protestant denomination faces high-stakes presidential vote
- Bodycam footage shows high
- Heat wave to bake Southwest; temperatures could soar as high as 120 degrees
Ranking
- Selena Gomez's "Weird Uncles" Steve Martin and Martin Short React to Her Engagement
- Prosecutors balk at Trump’s bid to delay post-conviction hush money rulings
- Meet the Hunter RMV Sherpa X-Line, the 'affordable' off-road RV camper
- Mexico finds the devil is in the details with laws against gender-based attacks on women politicians
- A Mississippi company is sentenced for mislabeling cheap seafood as premium local fish
- Murder on Music Row: Nashville police 'thanked the Lord' after miracle evidence surfaced
- Jardin Gilbert targeting call helps lead to USC game-winning touchdown vs LSU
- Congo says at least 129 people died during an attempted jailbreak, most of them in a stampede
Recommendation
Behind on your annual reading goal? Books under 200 pages to read before 2024 ends
Murder on Music Row: Nashville police 'thanked the Lord' after miracle evidence surfaced
Do smartphone bans work if parents push back?
Police say 4 people fatally shot on Chicago-area subway train
Why Sean "Diddy" Combs Is Being Given a Laptop in Jail Amid Witness Intimidation Fears
Adele reveals she's taking an 'incredibly long' break from music after Las Vegas residency ends
Elle Macpherson reveals she battled breast cancer and declined chemotherapy: 'People thought I was crazy'
Virginia mother charged with cruelty, neglect after kids found chained in apartment