Spotify’s Q3 2024 results demonstrate significant progress toward full-year profitability, a first for the streaming leader. Adding 6 million premium subscribers, Spotify reached 252 million paying users, while total monthly active users grew by 14 million to 640 million. The company posted €4.0 billion in revenue, a 19% year-over-year increase, alongside a record €454 million in operating income and a 31.1% gross margin, up from 26.4%.
CEO Daniel Ek credited team execution for the results and noted Spotify’s enhanced video expansion strategy, which will be detailed soon. Reduced operating expenses—down 8% year-over-year—resulted from streamlining personnel and marketing. Additionally, after its recent U.S. price hike, Spotify remains a bit pricier than competitors like Apple Music.
Last month, Spotify launched music videos in beta in 85 new markets (97 markets in total) and in July, Spotify launched comments for podcasts, letting podcast creators “better connect with and grow their audiences.”
“We’ve never been in a stronger position, thanks to the outstanding execution by our team. I’m incredibly proud of the way we’ve delivered and the progress we’ve made,” said Daniel Ek, Spotify Founder & CEO, “We’re where we set out to be—if not a little further—and on a steady path toward achieving our long-term goals. This relentless pursuit of innovation and commitment to growth sets us up to deliver the most valuable user experience in the industry, while reinforcing the core strengths that make Spotify unique. I am very excited about what lies ahead for us.”
For Q4, Spotify provided the following guidance:
- Premium subscribers: 260 million (net gain of 8 million)
- Total monthly active users: 665 million (net gain of 25 million)
- Total revenue: €4.1 billion
- Operating income: €481 million
- Gross margin: 31.8%
