Spotify is on track to earn a record $1.5 billion annual operating profit, marking its first profitable full year.
According to its Q3 2024 financial report, announced on November 12, the streaming giant highlighted key indicators indicating a solid performance, fueled mostly by an increase in premium subscribers and ad-supported revenue.
Spotify’s global Premium Subscriber base reached 252 million by the end of Q3 2024, up 12% year on year (YoY) and 6 million from the previous quarter.
This growth surpassed Spotify’s own guidance by 1 million net new subscribers, underscoring sustained momentum. As of September, Spotify had added 16 million net paying subscribers year-to-date, building on its Q4 2023 figure of 236 million.
The platform’s Monthly Active Users (MAUs) also experienced an 11% YoY increase, reaching 640 million by Q3’s close. This growth was largely fueled by new user additions in Latin America and the Rest of the World, where Spotify continues to expand aggressively. The company’s MAUs grew by 14 million since Q2 2024, another metric that outpaced internal guidance.
Financially, Spotify’s Premium revenue reached €3.516 billion ($3.86 billion) for Q3, up 24% YoY on a constant currency basis.
- The company credited its performance to premium growth across all regions, with Europe and Latin America leading at 38% and 22% growth, respectively.
- North America saw a robust 27% increase, bolstered by steady subscriber additions and Spotify’s stronghold in the region.
- On the advertising front, Spotify’s ad-supported revenue reached €472 million ($518.4 million) in Q3, up 7% YoY.
- The company’s investor presentation noted that music ad revenue grew due to increased impressions sold, though pricing softness remained a headwind. Despite a challenging environment, Spotify has demonstrated resilience in the advertising sector, maintaining steady revenue gains.
- Spotify’s gross margin for Q3 finished at 31.1%, with quarterly operating income nearly reaching €454 million ($499 million).
For the first three quarters of 2024, the company reported an operating profit of €888 million ($975 million), setting it firmly on course to meet its full-year profit forecast of €1.37 billion ($1.5 billion).
