Spotify Credits Price Adjustments for 11% Year-Over-Year Revenue Growth in Q3
Oct 27, 2023 10:01 pm
Spotify's shares surged by 10% during Tuesday's trading session, a response to the unexpected third-quarter profit, marking the company's first profitable quarter in over 18 months. This remarkable turnaround is attributed to a combination of price adjustments and diligent cost-saving measures implemented by the streaming service.
In 2023, Spotify's stock has witnessed unprecedented growth, with its market value now standing at an impressive $33.22 billion. The Swedish music streaming giant reported a profit of 65 million euros (equivalent to $68.9 million), primarily driven by a reduction in marketing expenses and personnel-related costs. Earlier this year, Spotify undertook a strategic overhaul of its podcasting division, which included the unfortunate but necessary step of laying off 200 employees, representing 2% of its workforce.
Spotify initiated a revision of its subscription pricing earlier in the year, resulting in a monthly bill increase of $1 to $2 for users, contingent upon their chosen plan. In its third-quarter financial report, Spotify acknowledged that the "initial impacts of the price adjustments" played a role in driving an 11% year-over-year growth in revenue.
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