Spotify Stock Surges on Premium Subscription Price Hike Plans
August 4, 2025 – Spotify Technology SA (NYSE:SPOT) saw its stock soar 5.4% in pre-market trading today, reaching $672.901 per share, following the announcement of planned price increases for its Premium subscription service across multiple international markets. The Swedish music-streaming giant revealed it will raise prices starting in September in regions including South Asia, the Middle East, Africa, Europe, Latin America, and the Asia-Pacific. For example, in one unspecified European country, the Premium individual subscription will increase by €1, from €10.99 to €11.99, a roughly 9% hike.
The price adjustments come as Spotify aims to bolster its margins amid a push for profitability. The company, which reported its first annual profit in 2024, has been implementing cost-cutting measures, including layoffs and reduced marketing spend. Spotify’s stock has gained about 40% this year, reflecting investor confidence in its strategy, despite a recent 11.9% drop on July 29. Citi analysts raised their price target for Spotify to $780 from $715, maintaining a Neutral rating, citing potential revenue growth from the price hikes.
However, the move carries risks. Previous price increases, such as the U.S. hike in June 2024, which raised the Premium individual plan to $11.99, Duo to $16.99, and Family to $19.99, sparked concerns about subscriber churn. Despite these worries, Spotify’s subscriber base grew to 239 million Premium users by Q1 2024, up 14% year-over-year, suggesting resilience.
The price hikes follow Spotify’s strategic shift to diversify its offerings, including audiobooks and potential “Supremium” tiers with high-fidelity audio. While these moves aim to reduce reliance on music streaming, which incurs high royalty costs, they’ve drawn scrutiny. The Mechanical Licensing Collective sued Spotify in May 2024, alleging underpayment of royalties by reclassifying Premium tiers as bundles with audiobooks.
As seen in the finance card above, Spotify’s stock has shown volatility, with a year-high of $785 and a low of $300.57. The current surge reflects optimism about revenue growth, but market uncertainty persists as investors weigh the long-term impact of pricing strategies on subscriber retention and profitability.
Spotify’s management remains confident, with CEO Daniel Ek emphasizing flexibility in subscription tiers to attract a broader user base. Existing subscribers will receive email notifications about the price changes over the next month.