Spotify (SPOT) wants its customers to shell out more cash for its services. The audio streaming company just announced in a blog post that it's hiking its subscription prices next month, about a year after its last price increase.
The price for a Premium Individual subscription will increase from $10.99 to $11.99 a month. Its Duo plan will have an even bigger jump from $14.99 to $16.99 a month, which is a $2 increase. Its Family plan is also changing from $16.99 to $19.99 monthly, a $3 price hike.
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The change will already affect new subscribers, but for existing subscribers, they will see the price increase take effect in their July billing date. In an upcoming email to existing Premium Individual subscribers that Spotify previewed in the announcement, the company claims that the price increase will help it make future investments.
“We’re increasing the price of Premium Individual so that we can continue to invest in and innovate on our product offerings and features, and bring you the best experience,” reads the upcoming email.
Some customers took to social media platform X to express their frustration with the latest price increase.
@Spotify @SpotifyCares what a joke, another price increase! I only want music, I don't want your audiobook, I don't want your podcast! I only want music! Why do you hate your customers so much?
— Cburn (@c_cburn) June 3, 2024
spotify raising their price to $12… literally what about that app is worth $12
— perry (@cmfrtcrwd) June 3, 2024
Spotify is one more price increase from losing me as a customer. Raising the price from 9 dollars to 12 in two years with no benefits or improvements
— Zeus Fans Int’l. (@l30moodtrbl) June 3, 2024
The move from Spotify comes after it raised its monthly prices for its Individual, Family and Student plans by $1 last year in July. Its Duo plan at the time also increased by $2 per month.
The change also comes at a time when Spotify appears to be doing well financially. In Spotify’s first-quarter earnings report for 2024, the company’s total revenue grew by 20% year-over-year.
But, the company revealed that its monthly active listeners grew by 19% year-over-year to around 615 million, which is below its guidance of 618 million for the quarter.
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Despite that, its Premium subscribers grew by 14% year-over-year to 239 million, which is in-line with expectations for the first three months of 2024.
During an earnings call on April 23 discussing the company’s first-quarter earnings for this year, Spotify CEO Daniel Ek claimed that the company believes that price increases won't have a negative impact on its subscriber numbers.
“It's really a mix of many different things that we're considering as we're raising prices,” said Ek during the call. “But the main one, if I want to focus you on one, it's really around value to price ratio and keeping that very healthy where we're obviously offering a lot more value to consumers than what we're capturing through the price increases. But I feel really good about us doing that. That's also why you saw us having a healthy guidance on the subs number too, because we think consumers like what they're seeing from Spotify. They love the offering and they feel that the value that they're getting is more than fair.”
Shares of Spotify were up more than 5% at last check Monday afternoon on the news.
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