Spotify reported its first full-year profit Tuesday, and an additional 35 million monthly active users.
The audio giant reported 675 million monthly active users, the largest fourth-quarter increase in Spotify’s history, as the company reported momentum from “strong holiday and Wrapped campaigns.” Paid subscribers grew 11 percent year over year to 263 million, up from 252 million last quarter and 3 million above guidance. Both came in above Spotify’s guidance.
Spotify CEO Daniel Ek also attributed the growth to product enhancements in audio books and in video, with more than 330,000 video podcasts globally on the platform that no longer feature ads for premium users and a recently launched partner program for creators.
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Total revenue grew 16 percent year over year to €4.2 billion. Operating income finished at a high of €477 million, with Spotify’s first full year of operating income hitting €1.4 billion. Operating expenses declined 16 percent year over year in Q4.
Ad-supported revenue grew 7 percent year over year, with music and podcast advertising driven by growth in impressions sold, partially offset by softness in pricing.
The Wrapped campaign delivered “record-high user engagement, up 10 percent year over year, across 184 markets and 53 languages, according to Spotify.
Spotify expects 678 million monthly active users for the first quarter of 2025, up 3 million monthly active users, with paid subscribers hitting 265 million. Operating income is expected to reach €548 million.
On Jan. 26, Spotify announced a new multiyear deal with Universal Music Group.
“I am very excited about 2025 and feel really good about where we are as both a product and as a business,” Ek said. “We will continue to place bets that will drive long term impact, increasing our speed while maintaining the levels of efficiency we achieved last year. It’s this combination that will enable us to build the best and most valuable user experience, grow sustainably and deliver creativity to the world.”
With the company’s operational headquarters in Stockholm, Sweden, Spotify shares are listed on the New York Stock Exchange in the form of American depositary receipts under ticker symbol SPOT. Shares of Spotify were up 8.5 percent in premarket trade Tuesday.
