Spotify raises US prices of its premium plans in margin push
A screen displays the logo and trading information for Spotify on the floor at the New York Stock Exchange (NYSE) in New York City, U.S., February 6, 2024. REUTERS/Brendan McDermid/File Photo
Spotify raised prices for its premium plans in the United States on Monday (Jun 3), the latest step by the Swedish music-streaming service in its push to increase margins.
On a monthly basis, Spotify has raised prices of its individual plan to US$11.99 from US$10.99, duo plan to US$16.99 from US$14.99 and its family plan to US$19.99 from US$16.99 in the US.
Spotify has been trying to boost its margins in recent months by lowering marketing spending and through layoffs, after relying on promotions and hefty investments to drive user growth.
Shares of the company, which competes with services from Apple and Amazon.com, rose 3.3 per cent in premarket trading.
"We're increasing the price of Premium Individual so that we can continue to invest in and innovate on our product offerings and features," Spotify said in an email, which it plans to send to its subscribers in the US over the next month.
The company offers an advertising-supported free service with limited features and a subscription-based paid service that gives access to all its functionality, with premium subscribers accounting for most of its revenue.
Spotify in February forecast a nearly 14 per cent jump in premium subscribers to 239 million in the current quarter, which was above estimates of 238.3 million.
