Spotify has strengthened its appeal to music content creators by paying out more than $11 billion to the global music industry in 2025, marking the largest annual payout ever made by a digital music platform. The Swedish streaming giant said its royalty distributions grew by more than 10 percent year over year, highlighting rising earnings opportunities for artists, songwriters, and record labels on the platform.
Charlie Hellman, Spotify’s Head of Music, in a blog post, said independent artists and independent labels accounted for nearly half of all royalties paid during the year, underlining the growing role of self-published and non-major-label creators in the streaming economy. Spotify accounts for roughly 30 percent of recorded music revenue.
Spotify royalties grow as platform competition intensifies
Spotify said the record payouts reflect its revenue-sharing model, under which the company distributes close to 70 percent of its music revenue back to the industry. As Spotify’s overall revenues increase, payouts to music content creators rise in parallel.
The company is stepping up efforts to attract and retain artists as competition in music streaming intensifies. Rivals such as YouTube and Apple Music are aggressively expanding their creator ecosystems. YouTube disclosed in October that it paid more than $8 billion to the music industry in the 12 months from July 2024 to June 2025, Reuters news report said.
For music creators, the intensifying competition among platforms is translating into more monetization options, broader audience reach, and higher aggregate payouts. The latest Omdia report said music videos account for 33 percent of all YouTube viewing time. YouTube video service is on track to reach 30 billion videos in early 2026.
Independent artists gain a larger share of streaming income
Spotify said independent artists and labels received about half of total royalties in 2025, reinforcing a long-term shift away from traditional major-label dominance. The platform has been investing in tools, analytics, and discovery features aimed at helping emerging musicians grow audiences and generate sustainable income.
This focus on independent music creators has become central to Spotify’s strategy as it seeks to differentiate itself in a crowded market.
Reinvestment into podcasts, video, and audiobooks
While paying out the majority of its revenue, Spotify said it reinvests the remaining share into expanding the platform. The company is pushing beyond music into podcasts, video content, and audiobooks, creating new formats and revenue streams for creators.
These investments are designed to deepen user engagement and open additional monetization avenues for creators who want to diversify beyond traditional music releases.
Subscription price hikes support long-term payouts
Spotify has recently increased prices for its premium subscription plans in several markets to improve profitability and support long-term growth. The company aims to leverage its large and loyal user base to sustain higher payouts to music content creators while continuing to invest in new content formats.
Spotify ended the third quarter with 713 million monthly active users, giving it one of the largest global audiences in the digital music ecosystem. More than 750 million people around the world are now paying every month for music streaming, across all streaming services.
For music content creators, Spotify’s record $11 billion payout signals both the scale of the streaming opportunity and the platform’s commitment to keeping artists at the center of its growth strategy.
BABURAJAN KIZHAKEDATH
