Spotify said on Tuesday (Aug. 4) it added one million more new premium subscribers in the second quarter than expected, which helped to offset a slight miss on its guidance for total monthly user growth and helped meet revenue growth targets.
Spotify’s total 777 million monthly average users generated 14% revenue growth of 4.777 million euros, in line with earlier guidance. The streamer beat guidance on its all-important gross margin, which expanded by 193 basis points to 33.4%, and on operating income, which totaled 655 million euros.
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This was the first time Spotify’s co-CEOs Alex Norström and Gustav Söderström had spoken publicly to investors and analysts following the company’s investor presentation day in May, and they said new products like their ticket reservation, AI playlisting and remixing tools showed strong momentum, while investments in AI and marketing were “entirely in our control.”
Operating expenses rose 3% to 941 million euros on investments in technology, including AI, and marketing, the company said. The company’s stock was down 1.5% to $479 a share at 1 p.m. in New York.
