Spotify shares surge in subscriber earnings, first-year profit
(Bloomberg) – Spotify Technology SA released another quarter of subscriber growth in the fourth quarter, helping Swedish music companies record their first-ever annual profit.
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Spotify said in a statement Tuesday that the total number of monthly active users increased to 675 million. This is compared to the average Wall Street estimate average, according to analysts surveyed by Bloomberg. The company also released a record increase in subscribers, with paying customers up 11% to 263 million, also surpassing expectations.
CEO Daniel Ek has been pushing Spotify’s dominance in music streams, adding audiobooks, podcasts and videos that despite more than a year, attracting despite two rounds of price increases More paid subscribers. Combined, the elimination of about 1,500 jobs has contributed to Spotify’s first full-year profit since its launch in 2008. The company reported that its total net income in 2024 was 1.14 billion euros ($1.2 billion).
EK acknowledged the company's transformation, noting that Spotify's first 16 years have been focusing on “driving meaningful scale.” We don't have to worry about profitability,” he said on a conference call with analysts. “By reducing costs, but then in the monetization year, I think we're now also proving that we are also a great business. “
EK hopes the company continues its profitable growth trajectory this year, creating a “accelerated execution year” for 2025. He said. “We will double down on music and we will be disciplined.”
The company said it expects to add 3 million monthly active users and about 2 million premium subscribers in the first quarter. Revenue is expected to rise to €4.2 billion from a year ago, with gross margin reaching 31.5%, due to the increase in premium subscriptions.
Spotify shares rose 138% last year, with shares rising 11% to $606.95 as trading in New York started.
Earlier this year, Spotify launched a new video creator product that will compensate contributors based on the consumption of content viewers without having to rely on advertising. In the growing video podcast market, it is more directly against YouTube.