Spotify Shares Surged 12.3% as Quarterly Revenue, User Growth Beats Expectations

Spotify shares surged 12.3% as quarterly revenue, user growth beats expectations.Spotify reported second-quarter revenue above analysts' estimates on Wednesday, helped by a 14% jump in paying subscribers as more users listened to its podcasts, and the company forecast an upbeat current quarter.

The Swedish music streaming company posted a 23% increase in revenue to 2.9 billion euros ($2.94 billion), beating analysts' expectations of 2.8 billion euros, according to IBES data from Refinitiv.

Premium subscribers, which account for most of the company's revenue, rose to 188 million, beating analysts' expectations of 187 million.

Total monthly active users rose 19% to 433 million. Analysts had expected 428 million.

Spotify, which had been aggressively hiring in the first two quarters, has slowed headcount growth by 25% beginning in the third quarter, while also taking a closer look at marketing activity.

The company forecast current-quarter paid subscribers of 194 million, in line with expectations. It expects revenue of 3 billion euros, above estimates of 2.95 billion euros.

Spotify has bet big on podcasts, investing over a billion dollars in acquiring shows such as the "The Joe Rogan Experience" and other businesses in a bid to draw users to a growing non-music audio segment.

The company said podcast listeners reached a record in the quarter, as members choose from among 4.4 million podcasts.

The company expects total monthly active users of 450 million in the third quarter.