According to Thurrott.com, Spotify lost €72 million on €4.27 billion in revenue during the quarter ending September 30, 2025, despite revenue growing 1.85 percent. The streaming service added 17 million monthly active users, hitting 713 million total with 281 million paid subscribers and 446 million ad-supported users. Premium subscribers generated €3.8 billion while ad revenue declined 6 percent to €446 million. Co-founder Daniel Ek announced he’ll step down as CEO on January 1 after claiming the business is healthy and showing “profit expansion.” The quarter also saw 30 new product launches including lossless audio, Apple TV revamp, and OpenAI ChatGPT integration.
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The Financial Reality Behind the Numbers
Here’s the thing about Spotify‘s earnings report – there’s some serious spin happening. The company keeps talking about “constant currency” growth of 12 percent when the actual revenue increase was just 1.85 percent. And they’re calling it profitable when they lost €72 million? Basically, they’re using operating income numbers that exclude real costs that actually hit their bottom line. It’s creative accounting at its finest.
Look, the user growth is genuinely impressive – 713 million active users is massive. But when your ad revenue drops 6 percent while you’re adding millions of new users, that’s concerning. The math just doesn’t add up to sustainable profitability, no matter how you slice it.
The Streaming Wars Intensify
Spotify’s pushing hard with all these new features because they have to. Apple Music has been offering lossless audio for years, and now Spotify’s finally playing catch-up. The OpenAI integration? That’s them trying to out-innovate everyone else in the AI race. But here’s the question – are these features actually moving the needle, or just checking boxes?
The timing of Ek’s departure is interesting too. After building this massive platform, he’s leaving right as the company faces its toughest competitive landscape yet. Apple, Amazon, and YouTube are all pouring billions into their music services. Can Spotify maintain its lead without its visionary founder at the helm?
The Pricing Problem
Spotify’s been gradually increasing prices across markets, and that’s clearly helping premium revenue grow 9 percent. But there’s a limit to how much people will pay for music streaming. We’re already seeing pushback from subscribers tired of annual price hikes.
And the ad-supported side? That 6 percent decline suggests advertisers might be getting smarter about where they spend. With TikTok and YouTube dominating short-form video, Spotify’s audio-only ads might be losing their appeal. They need to figure out their ad strategy fast, because relying solely on subscription increases isn’t a long-term solution.
What Comes Next After Ek
Daniel Ek built Spotify from nothing into a household name. His departure marks the end of an era, but maybe it’s time for fresh leadership. The new CEO will inherit a company with incredible reach but persistent profitability challenges.
The real test will be whether they can turn all these new features – the 30 product launches they’re so proud of – into actual revenue drivers. Because right now, having 713 million users sounds amazing until you realize you’re still losing money serving them. The shareholder deck shows the ambition, but the numbers show the reality. It’s going to be a fascinating transition to watch.
