Spotify has reported a profitable third quarter for 2023. This marks a significant shift from the company’s usual trend of reporting losses, as it has traditionally prioritized user base expansion over immediate profits.
The company’s Q3 earnings report revealed a profit of €65 million, a stark contrast to the €166 million net loss reported in the same period last year. Operating income also saw a substantial improvement, standing at €32 million compared to the previous year’s operating loss of €228 million.
Despite a recent increase in subscription prices, Spotify’s premium subscribers grew by 3% from the second quarter and 16% year-on-year. The total number of monthly active users also rose to 574 million, marking a 4% increase from the previous quarter and a 26% increase year-on-year.
This growth in user base and profitability comes as the company prepares to launch a new tier of service called ‘Supremium.’ Aimed at audiophile users, this upcoming lossless streaming tier is expected to cost $19.99 and will include additional premium features. The anticipation for this new offering is high among Spotify’s user base.
While the company’s financial turnaround is noteworthy, it remains to be seen how the introduction of the ‘Supremium’ tier and potential future price hikes will impact Spotify’s user growth and profitability in the long run.