Spotify Surges Past 276 Million Paying Customers, Misses on Second Quarter Sales Estimates
Spotify in the second quarter easily topped Wall Street’s expectations on one metric, by adding eight million paying customers — pushing it to 276 million so-called premium customers overall — but the music and podcast streaming company’s stock price took a big hit in pre-market trading on Tuesday morning after it failed to meet other analyst projections for both sales and earnings.
The Stockholm-based company’s stock price dropped 6% to about $660 per share in pre-market trading on Tuesday, minutes after Spotify reported €4.19 billion, or $4.85 billion, in second quarter revenue — or about $150 million less than what analysts were looking for.
Another part of Spotify’s report that jumped out: the company reported a loss of €0.42 per share, or about $0.49 per share, while analysts had expected €1.97 earnings per share. That translated to a loss of about $100 million for the second quarter.
The quarterly loss comes after Spotify posted a healthy profit in the first quarter of 2025 and was coming off of its first full-year profit in 2024.
CEO Daniel Ek, during Spotify’s earnings call on Tuesday, said the company is investing in parts of its business, like podcasts, that it believes will be long-term winners, rather than “make decisions that achieve specific short-term quarterly outcomes.” He added the company’s progress “is not always linear.”
On the bright side for Spotify, it added three million more premium subscribers than analysts had projected for second quarter. “Spotify Premium” costs $11.99 per month for the individual plan in the U.S., according to Spotify. Other plans include “Premium Duo” at $16.99/month, “Premium Family” at $19.99/month, and “Premium Student” at $5.99/month.
And Spotify also reported healthy growth among its free memberships as well, with the company adding 18 million monthly users during the second quarter. That was up 12% year-over-year and helped Spotify end the quarter with 696 million global users.
“People come to Spotify and they stay on Spotify. By constantly evolving, we create more and more value for the almost 700 million people using our platform,” Ek said in a statement accompanying earnings. “This value not only benefits users but it’s attracting more people to streaming and as a result, it’s also boosted the industries of music, podcasts, and audiobooks.”
Here are some of the key results:
Revenue: Spotify reported €4.19 billion in second quarter revenue, or $4.85 billion, up 10% from last year. Analysts had projected Spotify would report €4.27 billion in sales, and the company last quarter had estimated it would report €4.30 billion.
Advertising revenue dropped 1% year-over-year to €453 million. The company pointed to “softness in pricing and optimization of our podcasting inventory” as a reason for the slight dip in ad sales.
Subscribers: Spotify added eight million Premium subscribers between April and June, surpassing the 5 million subscribers Wall Street was looking for. The company ended the quarter with 276 million Premium customers, up 12% year-over-year.
Spotify said in its report there was not one market to point to in particular for its strong quarterly growth. The slice of Spotify’s Premium memberships that come from Latin America and the “Rest of World” sector — excluding the U.S., Canada, and Europe, essentially — was 37%, up from 35% a year ago.
Earnings Per Share: The streaming company reported a loss of €0.42 per share, while analysts were looking for €1.97 EPS. The loss stands out, considering Spotify reported €1.07 EPS last quarter and €1.33 EPS during the same quarter a year ago.
An even easier way to look at it: Spotify lost $100 million after reporting a profit of nearly $275 million during the second quarter of 2024.
Spotify, in its report, pointed to “higher costs associated with personnel and related, professional services and marketing.”
Monthly Users: There were 696 million monthly Spotify users at the end of June, up 18 million from the first quarter. The 18 million new users was six times more than the three million monthly users Spotify added in the first quarter; Spotify reported a company-record 35 million monthly users joined the service during the final three months of 2024.
Spotify, even with a recent dip, had been white hot on Wall Street heading into Tuesday, with its share price increasing 53% since the start of 2025.
Notably, Spotify did not mention artificial intelligence in its report, except for saying the “use of artificial intelligence” could affect its business in the small print of its Forward Looking Statements section.
Later on Tuesday morning, on the company’s earnings call, Spotify Co-President Gustav Söderström said AI is improving playlist curation and recommendation. For example, he said AI makes it easy for users to type “in plain English” what they want to hear in their playlists, like “songs to pump you up”; previously, he said Spotify was “confined to guessing” what users wanted based on what they had listened to in the past.
Spotify also did not talk much about its continued push into podcasts — and in particular, video podcasts — in its second quarter report.
As TheWrap reported in April, Spotify’s internal data found nearly two-thirds of subscribers prefer podcasts with video, which helped spur the company to launch its “Spotify Partners Program” earlier this year, giving creators more tools to create and monetize video podcasts. For podcasters, the big draw is that Spotify will now pay them an undisclosed slice of extra money, based on how many Premium subscribers watch their show.
By the early part of the second quarter, Spotify had 330,000 video podcasts on its platform — more than triple the amount it had two years earlier. That figure grew to 430,000 video podcasts by Tuesday, according to Söderström on the company’s second quarter call.
The post Spotify Surges Past 276 Million Paying Customers, Misses on Second Quarter Sales Estimates appeared first on TheWrap.
Welcome to Billionaire Club Co LLC, your gateway to a brand-new social media experience! Sign up today and dive into over 10,000 fresh daily articles and videos curated just for your enjoyment. Enjoy the ad free experience, unlimited content interactions, and get that coveted blue check verification—all for just $1 a month!
Account Frozen
Your account is frozen. You can still view content but cannot interact with it.
Please go to your settings to update your account status.
Open Profile Settings