Shares of Spotify climbed over 3% in pre-market buying and selling on Tuesday after the corporate beat Wall Road expectations for its third quarter of 2025, with complete income rising 7% to €4.3 billion ($4.93 billion), pushed by a rise in paid subscribers.
The music streaming large added 5 million premium subscribers for a complete of 281 million. Whole month-to-month lively customers (MAUs) grew to 713 million, up from 696 million within the earlier quarter, whereas ad-supported MAUs hit 446 million, up from 433 million. The expansion was pushed by sturdy quarter over quarter and yr over yr progress throughout all areas, the launch of cell free tier enhancements globally and profitable advertising campaigns in choose growing markets.
Premium income grew 9% to €3.83 billion, reflecting subscriber progress and a 4% decline in common income per consumer. Excluding the affect of overseas alternate, ARPU was boosted by the corporate’s latest worth improve, offset by product/market combine. In the meantime, ad-supported income fell 6% to €446 million.
Listed here are the quarter’s outcomes:
Web revenue: A revenue of €899 million, in comparison with a lack of €86 million a yr in the past.
Earnings Per Share: €3.28 per share, in comparison with €2.14 per share anticipated by analysts surveyed by Yahoo Finance.
Income: €4.3 billion, up 7% yr over yr, in comparison with €4.23 billion anticipated by analysts surveyed by Yahoo Finance.
Working revenue: €582 million, up 28% yr over yr
“The enterprise is wholesome. We’re transport sooner than ever. And we’ve got the instruments we’d like – pricing, product innovation, operational leverage, and ultimately the advertisements turnaround – to ship each income progress and revenue enlargement,” Spotify founder CEO Daniel Ek mentioned in a press release. “All of it comes again to consumer fundamentals and that’s the place we’re: 700 million customers who preserve coming again, engagement at all-time highs. We’re constructing Spotify for the long-term.”
Throughout the quarter, Spotify launched lossless audio to premium customers in 50 markets and rolled out a Messages function to free and premium customers ages 16 and older in choose markets on cell, permitting them to maintain monitor of suggestions and share their favourite music, podcasts and audiobooks with family and friends. It additionally launched a beta for a brand new mixing instruments function that enables customers so as to add and customise transitions to tracks to create distinctive playlists.
Moreover, Spotify additionally launched an integration with ChatGPT, permitting customers to obtain customized music and podcast suggestions. ChatGPT has been built-in throughout greater than 2,000 gadgets.
Different highlights through the quarter embody Spotify’s English language catalog of audio books tripling from 150,000 to over 500,000 titles since launch, its Jam function hitting 100 million month-to-month listening hours and Taylor Swift’s “The Lifetime of a Showgirl” changing into Spotify’s most-streamed album in a single day and essentially the most pre-saved ever.
The most recent quarterly outcomes come as Ek will transition to the position of government chairman. The streaming large has switched to a co-CEO construction with present co-presidents Alex Norström and Gustav Söderström set to serve within the roles beginning Jan. 1.
It additionally comes a number of sports activities, tradition, life-style and true crime video podcasts from Spotify Studios and The Ringer are set to debut on Netflix within the U.S. beginning in early 2026, with different market to observe.
Wanting forward, Spotify expects so as to add 32 million month-to-month lively customers for a complete of 745 million and eight million premium subscribers for a complete of 282 million within the fourth quarter. It is usually forecasting income of €4.5 billion and working revenue of €620 million.
Spotify shares are up 70% prior to now yr, 40% yr up to now and 1% prior to now six months.
Extra to come back…
