The number of paid subscribers to the music streaming service Spotify, which is based in Sweden, has now reached 220 million. The company announced in its Q2 2023 earnings call that its subscribers grew by 17% year-over-year. Meanwhile, with a 27% increase, Spotify's monthly active users (MAU) count has reached 551 million.
The earnings report landed a day after Spotify bumped the prices of its monthly subscriptions. Its Spotify Premium individual plan will now set users back every month by $10.99 and Premium Duo will cost $14.99/mo.
Spotify claims that the subscriber gain represents "the highest Q2 in company history." It was able to add 10 million premium users in the second quarter which exceeded estimates by 3 million. For reference, Spotify had 210 million paying subscribers in Q1 2023 with a 15% year-over-year growth.
Similarly, Spotify made net additions of 36 million to its monthly active users, beating the expectation by 21 million. Spotify notes that the improved MAU count was supported by "strong growth amongst Gen Z listeners." Meanwhile, Europe and Latin America regions made significant contributions to its premium subscriber growth.
On the financial front, Spotify reported a gross margin of 24.1% in the second quarter while missing the expectation of 25.5%. Its total revenue, reported at €3.2 billion ($3.5 billion approximately), grew by 11% year-over-over and is in line with the estimates, the company said.
Furthermore, Spotify reported an adjusted operating loss of €112 million ($124 million) after taking into account the recent layoffs in the podcast division and related charges.
Spotify added a number of features during the second quarter, including a redesigned desktop app, widgets for iOS, and integration with the Strava app. However, users are still waiting for the Spotify HiFi tier to arrive on the market and a recent report suggests the company might launch HiFi sometime in 2023.
Apart from that, the Stockholm-headquartered company is trying to diversify the content on its platform. It was reported that Spotify is in talks with partners to feature full-length music videos in its app, putting itself in line with YouTube Music.