((Automated translation by Reuters, please see disclaimer https://bit.ly/rtrsauto))
(Updated share movements in paragraph 4, added details on annual US turnover in paragraph 6)
Spotify SPOT.O increased the prices of its premium packages in the United States on Monday, the latest measure taken by the Swedish music streaming service to increase its margins.
The company increased the prices of its individual plan from $10.99 to $11.99 per month, its duo plan from $14.99 to $16.99, and its family plan from $16.99 to 19.99 $ in its largest market in terms of revenue.
In recent months, Spotify has attempted to increase margins by cutting marketing spending and making layoffs , after relying on significant promotions and investments to drive user growth.
Shares of the company, which competes with Apple’s AAPL.O and Amazon.com’s AMZN.O , rose more than 4% in morning trading.
“We are increasing the price of the Premium Individual subscription so that we can continue to invest and innovate in our product and feature offerings,” Spotify said in an email it plans to send to its subscribers in the United States over the next month.
Spotify’s U.S. revenue rose nearly 11% to €5.23 billion ($5.69 billion) in 2023, according to its annual report.
The company offers a free, ad-supported service with limited features and a paid subscription service that provides access to all of its features, with premium subscribers accounting for the majority of its revenue.
Analysts say the streaming giant could continue its growth by offering subscription plans tailored to consumer preferences in verticals such as music, audiobooks and podcasts.
The company’s quarterly gross profit topped 1 billion euros ($1.09 billion) for the first time in April, after it cut marketing spending.
The number of premium subscribers increased 14% to 239 million and the company forecasts monthly active users of 631 million for the second quarter.
(1 dollar = 0.9192 euros)
