Spotify's plan to increase some of its prices may not be popular with customers, but it is faring well with investors.
Its stock gained as much as 4 per cent on Monday to $295.33 on news that the audio streaming giant is increasing rates for certain services in the US and other countries. Its US family plan will climb to $15.99 from $14.99 on April 30, and several service tiers in the UK will also see a hike.
“We offer a variety of subscription plans tailored to our users’ needs, and we occasionally update our prices to reflect local macroeconomic factors and meet market demands,” the company said in an emailed statement.
Investors are betting the price increases can give Spotify more of a cushion as it pursues dominance in the podcasting market. Jefferies analyst Andrew Uerkwitz last week initiated coverage of the company with a buy rating, saying the company is likely to become “the primary audio platform for creators”.
The shares had been down almost 10 per cent this year through the end of last week.
Spotify, based in Stockholm, reports its latest quarterly results on Wednesday.
