What's Next For Spotify? More Price Hikes Could Be Coming After Strong Q2 Performance
Portfolio Pulse from Franca Quarneti
Spotify Technology SA (NYSE:SPOT) hinted at potential future price hikes during its Q2 earnings call, following substantial increases in 2023 and 2024. Despite these hikes, Spotify added 7 million new subscribers in Q2 2024 and reported a revenue of €3.8 billion ($4.15 billion), marking a 20% YoY increase. The company also swung to a €266 million ($290 million) operating profit. CEO Daniel Ek and interim CFO Ben Kung attribute low churn rates to enhanced value and high engagement, particularly in developing markets. Spotify plans to launch a high-quality audio tier called HiFi, priced around $17-$18 per month.
July 25, 2024 | 8:04 pm
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Spotify hinted at potential future price hikes after a strong Q2 performance, adding 7 million new subscribers and reporting a 20% YoY revenue increase. The company swung to a €266 million operating profit. Low churn rates and high engagement, especially in developing markets, support the strategy. Spotify also plans to launch a high-quality audio tier called HiFi.
Spotify's strong Q2 performance, including a significant increase in subscribers and revenue, along with a swing to operating profit, indicates positive market reception to price hikes. The planned HiFi tier launch and high engagement in developing markets further support potential future price increases, likely boosting investor confidence and short-term stock price.
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