Spotify recorded 751 million monthly active users, an 11% increase from the previous year. The company added 38 million new users in the fourth quarter. Paying subscribers reached 290 million, a 10% rise.
Revenue totaled €4.53 billion ($5.39 billion), marking a 7% increase year over year. Subscription revenue grew by 8%. Ad-supported revenue decreased by 4% to €518 million ($616.6 million).
Gross margin improved by 83 basis points, reaching 33.1%, a record high. This improvement was attributed to increased ad sales for podcasts and music.
The company’s “Wrapped” campaign engaged over 300 million users and generated 630 million social media shares across 56 languages. New features on the free tier also contributed to user growth. Spotify has introduced an AI DJ and AI-generated playlists and allows users to exclude tracks from recommendations.
Spotify has expanded its offerings beyond music to include podcasts and audiobooks. The platform has launched in-app music videos and video podcasts. Social features, such as group chats and music sharing, have been implemented for user retention. Users can also book concert tickets and explore song origins. The company has increased subscription prices in the U.S. and Europe. New free tier features, including song search and selection, have been added to attract users.
Gustav Söderström and Alex Norström have assumed roles as co-CEOs. Co-founder Daniel Ek previously led the company. Spotify projects 759 million users and 293 million paying subscribers for the current quarter.
