The Facts
Music streaming service Spotify announced on Monday it will be raising prices by $1 or $2 across its four subscription plans in more than 50 markets.
Spotify followed its price hike announcement by reporting Tuesday that it beat expectations for monthly active users and subscribers in the second quarter. It also announced revenue of $3.51B, which analysts said came in below predictions.
The Spin
Narrative A
Spotify is attempting to prove it’s agile enough to meet the demands of Wall Street, which is now more interested in seeing streaming services move toward profitability rather than just expand their user base. This unsurprising price hike, along with other cuts and moves Spotify has made, should put it on the road to eventually turning a profit.
Narrative B
Spotify can’t gloss over its dreadful earnings call. In the face of staggering losses, it’s now desperately raising prices. Since the peak of the pandemic, Spotify hasn’t come close to duplicating the earnings it produced while people were cooped up, and based on the stock market's opinions of the streamer, Spotify has a deep hole to dig out of.
