SPOT also added 18 million monthly active users in the period to reach 696 million, while total revenue grew 15% year-on-year on a constant currency basis.
All of which wasn’t enough to make Wall Street happy.
Partly due to share price-connected compensation payouts, SPOT posted a net quarterly loss and lowered Q3 profit forecasts – resulting in its market cap value sinking by over $16 billion today. Oucha.
However, Q2 contained a number of significant milestones for Spotify, including surpassing 100 million subscribers in Europe, its largest region.
In fact, on its Q2 earnings call today, SPOT shared some remarkable market share statistics that underscore its dominance in global music streaming.
Here are seven key things we learned from that call…
1. Over 3% of the world now subscribes to Spotify – but it wants much more
Spotify Co-President Gustav Söderström threw up a few brain-busting stats on today’s call, including: “Excluding China and Russia, 45% of people who pay for a music streaming service subscribe to Spotify, according to Midia Research. And that percentage has been steadily growing over the years.”
Even more striking: Spotify’s share of total music consumption. “According to Luminate, 65% of global audio music streams now happen on Spotify,” said Söderström.
“Over 3% of the world’s population subscribes to Spotify… it’s not implausible to imagine us reaching 10% or even 15% of the world’s population.”
Alex Norström, Spotify
To put this in perspective, Luminate’s latest H1 2025 data showed total global audio streams reached approximately 2.5 trillion in the first half of 2025.
This implies that Spotify alone accounted for around 1.6 trillion streams during that period.
Such figures help explain CEO Daniel Ek‘s confidence about future growth potential.
“Over 3% of the world’s population subscribes to Spotify,” noted SPOT’s Chief Business Officer, Alex Norström, today.
“That’s pretty astounding, but also really encouraging when you think about how far we can still grow from here. And it’s not implausible to imagine us reaching 10% or even 15% of the world’s population.”
2. Spotify remains notably cagey on its long-awaited ‘Music Pro’ tier… despite being directly asked about it (again)
Despite months of industry speculation about Spotify’s ‘super premium’ tier launch – dubbed ‘Music Pro’ – the company offered few concrete details when directly questioned about it during today’s call.
When Bank of America analyst Jessica Reif Ehrlich (pictured inset) asked about “introducing a tier, whether it be ‘superfan’ or something else across your platform globally,” Norström provided a somewhat evasive response.
“We’re really excited about engaging ‘superfans’, as you know, and we’re building something great for them,” said Norström.
“But what investors really need to understand is how we build out our products at Spotify. As long as I’ve been here, which is now close to 15 years, we’ve had very high value standards around what – and when – to release product.”
“we’re making progress [on ‘Music Pro’] for sure, but it’s taking time. And in music, of course, we’re reliant on our partners to a certain degree.”
Alex Norström, Spotify
He added: “We’re working towards these very high-value standards, and we’re making progress [on ‘Music Pro’] for sure, but it’s taking time.
“And in music, of course, we’re reliant on our partners to a certain degree.”
Instead of providing more specifics about the music-focused super premium tier, Norström instead highlighted an audiobook add-on subscription currently available in 13 markets: “Right now, we are in market with an audiobook add-on subscription, which is about getting more hours for [hardcore book fans versus what Spotify offers in its standard] Premium allocation.”
The lack of concrete details suggests the much-anticipated ‘Music Pro’ tier may still be further away than many in the industry initially expected.
3. Spotify takes a ‘portfolio approach’ to pricing… and recently raised prices in four European markets with no unusual churn
When LightShed Partners analyst Rich Greenfield (pictured inset) asked why Spotify doesn’t raise prices more frequently, the company provided insights into its pricing philosophy.
This may disappoint those music rightsholders hoping for solid news on regular future rate hikes.
“We take a portfolio approach. So in a sense, you could say that we raise all the time,” explained Norström. “For instance, in the last quarter, we raised in France, Belgium, the Netherlands and Luxembourg. And I can report to you that on churn, we didn’t see anything out of the ordinary for Spotify.”
However, Spotify emphasized today that its approach prioritizes long-term subscriber retention over short-term revenue gains. “[Internally] we… obsess over the value-to-price ratio. We’ve always put subscribers on a pedestal,” said Norström.
CEO Daniel Ek reinforced this philosophy: “At scale, the subscription business is really around retention, not new customer acquisition… A lot better to keep the customer around for a longer time than to lose the customer back at a later point.”
When pressed by Greenfield about whether Spotify could raise prices faster given its high engagement, Norström reiterated: “We will raise price when it’s appropriate for the business.”
4. Generative AI is revolutionizing music discovery in ways that could reshape which songs get heard
Söderström provided extensive insights into how generative AI is revolutionizing Spotify’s understanding of user preferences, with potentially significant implications for music discovery and which tracks gain traction.
“There is a fundamental difference that happened with generative AI versus the previous AI,” explained Söderström. “We were [previously] confined to user signals… such as skips, plays and saves. Those are pretty blunt signals. A ‘skip’ could be a song that you love, but you’re tired of it… [or] you’re not tired of it, but it’s the wrong situation.”
He said this limitation is being overcome with generative AI. Spotify’s AI DJ feature exemplifies this transformation, with user engagement nearly doubling over the last year.
The DJ can now handle complex requests like: “Play me that song where Bruce Springsteen invites up that fan on stage in the music video. And DJ will understand that you are requesting Dancing in the Dark,” said Söderström.
This technology is also powering AI playlist creation, which has expanded to over 40 new markets.
Söderström said that generative AI enables users to tell Spotify “in plain English what they actually want, what’s on their mind, and even what they’re doing right now… things that would have been impossible for us to understand from listening data”.
As an example, users can now issue requests like “make me a playlist with songs to pump you up on earnings day in late July when your family is on summer holiday without you,” quipped Söderström, in a wistful moment that likely made attending analysts question a life spent studying the monetization of human loneliness.
Only joking!
5. Spotify’s multi-format strategy is driving higher engagement – but is it additive, or cannibalistic for music?
Spotify’s audiobooks business continues to expand quickly, with Söderström noting that Spotify now has “over 400,000 books” and recently launched in Germany, Austria, Switzerland, and Liechtenstein.
Meanwhile, the platform is also seeing dramatic growth in video consumption.
“In 2024, we went all in on video, and there are now more than 430,000 video podcasts on Spotify,” said Söderström. “Video continues to outperform with consumption trending higher and higher, growing 20x fasterthan audio-only consumption since 2024.
“More than 350 million users have streamed video podcasts on our platform – a 65% increase year-over-year.”
Norström added: “Users who watch a podcast consume 1.5x more than users who just listen.”
“Users who watch a podcast consume 1.5x more than users who just listen.”
Alex Norström, Spotify
Yet the question remains whether all this audiobook and podcast consumption benefits or competes with music consumption.
“The data clearly shows that the more content formats that we deliver for our users, the more engaged they become,” argued Söderström.
“This is especially true with the ‘super users’ who are not only spending more time but also more days on Spotify.”
Spotify’s executives consistently framed this multi-format approach as additive rather than cannibalistic to music.
6. Spotify hints at expanding its controversial “marketplace” model that charges artists for exposure
Spotify’s CFO Christian Luiga mentioned “marketplace monetization” as a future gross margin driver for music, which could signal an expansion of Spotify’s controversial Discovery Mode program.
When CitiGroup analyst Jason Bazinet asked about “key drivers of gross margin expansion after 2025,” Luiga cited several factors including “how we monetize the marketplace in music”.
This could be a reference to Spotify’s Discovery Mode, a program that allows artists and labels to accept lower royalty rates in exchange for increased algorithmic promotion.
The program has faced criticism from artist advocates and recently gained attention when it was mentioned in Drake’s lawsuit against Universal Music Group, with Drake’s team framing the program as a “pay-to-play” scheme.
Under Discovery Mode, artists can flag songs as priorities for recommendation algorithms, but Spotify takes a commission by paying reduced royalties on those streams.
Critics argue this creates a two-tiered system where artists and labels feel pressured to accept lower payments to compete for visibility.
If Spotify is indeed planning to expand its “marketplace” model, it could represent a significant shift in how the platform monetizes music beyond traditional subscription and advertising revenue.
However, the company provided no additional details today about what such an expansion might entail.
7. Spotify, which killed iTunes with streaming… has decided it quite likes paid-for downloads after all!
Looking ahead, Daniel Ek sees significant potential in à la carte transactions, which could create new revenue streams for creators.
“You could imagine à la carte transactions being a very big potential driver for future revenue growth,” said Ek.
“We played around with that when it comes to books, for instance, where it makes a lot of sense if you’re an author for us to be able to sell books – but you can also imagine new digital products that we could potentially introduce in the future as well.”
“We think that the big media platforms of the future will be the ones that have advertising, subscription, and a la carte as methods.”
Daniel Ek, spotify
Does this mean the humble music download – for example, as a pre-streaming, exclusively windowed access item – could be set to make a comeback?
Ek articulated a broader vision that could benefit artists across formats.
“Our [initial] view was that it simply didn’t make any sense for any media platform to be only subscriber-based or only be advertising-based. You need both of these drivers,” said Ek.
“But now we can also add a third driver, which is à la cartetransactions.
“We think that the big media platforms of the future will be the ones that have advertising, subscription, and a la carte as methods.”
This could indeed mean individual track or album sales.
Of course, it could also extend to other exclusive content and merchandise, too.
All eyes tilt towards that still-absent Spotify ‘Music Pro’ tier… and whether its arrival will come this year, next year, or a time yet to be determined.Music Business Worldwide
