Spotify delivered record user growth and strong profitability in its latest quarterly results, adding 38 million monthly active users (MAUs) and surpassing its own guidance as global demand for streaming, personalization and new content formats accelerated.
Spotify user growth beats expectations
Spotify reported record MAU net additions of 38 million, well ahead of its guidance of 32 million. Total MAUs rose 11 percent year over year to 751 million, up from 713 million in the previous quarter.
The company said growth came from all regions, with the strongest performance in Rest of World markets, Latin America and Europe. The surge was supported by mobile free tier enhancements, strong holiday promotions and its annual Spotify Wrapped campaign, which engaged more than 300 million users globally.
Premium subscriber growth also exceeded expectations. Spotify added 9 million net subscribers during the quarter, bringing the total to 290 million, a 10 percent year over year increase. Growth was recorded across all regions, led by Rest of World and North America.
Revenue rises to €4.5 billion with record margins
Spotify generated total revenue of €4.5 billion, up 7 percent year over year. Profitability improved significantly:
Gross margin reached a record 33.1 percent, up 83 basis points year over year
Operating income rose to €701 million, representing a 15.5 percent margin
Premium revenue grew 8 percent to €4.013 billion, driven by subscriber expansion. However, Premium ARPU declined 3 percent year over year to €4.70 due to product and market mix, despite benefits from price increases.
Ad-supported revenue declined 4 percent year over year but grew 4 percent on a constant currency basis. Music advertising benefited from higher impressions sold, while podcasting growth was driven by sponsorship gains and automated ad sales.
AI, video and audiobooks strengthen Spotify platform
Spotify continued expanding its product ecosystem with new features and formats designed to boost engagement and retention.
Key product highlights include:
Rollout of music videos for Premium users in select markets
Smarter Live Events discovery features
Launch of audiobooks and the Spotify Partner Program in Nordic markets
Beta launch of AI-powered Prompted Playlist, allowing Premium users to guide recommendations
The company also paid more than $11 billion to the music industry in 2025, marking the largest annual payout to creators in history.
Spotify outlook for Q1 2026
Spotify expects continued growth in the first quarter of 2026, forecasting:
Total MAUs: 759 million, implying 8 million net additions
Premium subscribers: 293 million, implying 3 million net additions
Revenue: €4.5 billion
Gross margin: 32.8 percent
Operating income: €660 million
The outlook includes an estimated foreign exchange headwind of about 670 basis points year over year.
Strong momentum continues into 2026
Spotify’s latest results highlight accelerating global adoption, improving profitability and a growing mix of AI-driven personalization, video and audiobook content. With continued investment in product innovation and creator payouts, the company is positioning itself for sustained growth in 2026.
BABURAJAN KIZHAKEDATH