Spotify posts record profits for second quarter of 2024

The ongoing controversies over its stinginess towards musicians doesn’t seem to have affected Spotify’s bottom line. In its second quarter figures for 2024 it reported a record profit of some €3.81billion (£3.2billion) – an increase of some 20% since the first quarter. The platform’s net profit for this period was €274 million (£230 million), which is some turnaround from the same period in 2023, when they made a loss of €302million (£253m).

This huge leap in profits can be put down to a number of factors. Firstly, subscribers to its Premium service have increased by 7 million during this period. Ad-supported revenue also grew by 13% in this time and shares have increased by 12% too. Prices of both individual and family plans have also increased – up from £9.99 to £10.99 per month in the UK for an individual.

And Spotify have shed a lot of costs. It cut 17% of its workforce at the end of 2023, which came on top of a 6% cut in mid 2023 that founder Daniel Ek claimed at the time was done to promote “speed”.

It should be noted that the record profits come even before Spotify rolls out its supposedly 'deluxe' service, Spotify HiFi. Ek has said that the service with its improved sound quality, is "coming soon", but as yet there has been no firm date for its launch. 

Another factor is surely the decision taken in early April to ‘de-monetise’ all songs that picked up less than a thousand streams, thereby cutting off a crucial revenue stream for many up and coming musicians.

Spotify rightly drew a lot of criticism for that move, which was compounded by Ek’s subsequent gaffe on Twitter/X in which the bearded billionaire mused that: “Today, with the cost of creating content being close to zero, people can share an incredible amount of content.”

There was a swift backlash to Ek’s comments from musicians across the spectrum. Promoter and ex Visage man Rusty Egan wrote “Cost of time to write music, cost of equipment to record music, cost to master and to upload to all platforms is not zero.” Meanwhile Primal Scream bassist Simon White Butler was more succinct: “Fuck off you out of touch billionaire.” Dance producer Deadmau5 even said he’d pull his catalogue from Spotify though it’s unclear whether he has since gone through with this threat.

None of this seems to be enough to dampen the public’s enthusiasm for Spotify. At present the platform has some 626 million monthly active users, of which 246 million are subscribed to Premium. It’s by some distance the most successful streaming platform out there. Musicians are well within their rights to ask if these vast profits might be now distributed a little more evenly to the people without whom there wouldn’t be a Spotify: themselves.