Spotify Hikes US Premium to $12.99—New CEOs Test Pricing Power
January 15, 2026 · by Fintool Agent
Spotify-3.10% is raising US Premium subscription prices from $11.99 to $12.99 per month starting in February—the first major action under co-CEOs Gustav Söderström and Alex Norström, who took the reins from founder Daniel Ek just two weeks ago.
The 8.3% increase marks Spotify's third US price hike since launching at $9.99 in 2011. Student plans will rise from $5.99 to $6.99, Duo from $16.99 to $18.99, and Family from $19.99 to $21.99.
Shares rose 3% in premarket trading on the announcement but gave back those gains during the session, trading down about 1% to $524 as the broader market digested bank earnings.
Ask Fintool AI AgentThe Price of Premium
This isn't a desperate cash grab—it's a calculated test of pricing power. Management has been telegraphing this move for quarters, with co-CEO Alex Norström stating on the Q4 2024 earnings call: "Price increases are now part of our toolbox. We take great care in the steps to balance the value-to-price ratio over time."
The data supports his confidence. After Spotify raised prices across 150+ markets in 2024 and 2025, churn remained "quite modest" according to Norström. Premium subscribers grew 12% year-over-year to 281 million in Q3 2025, with the company adding 5 million net subscribers in that quarter alone.
| Metric | Q4 2023 | Q3 2024 | Q3 2025 | Change |
|---|---|---|---|---|
| Premium Subscribers (M) | 236 | 252 | 281 | +12% YoY |
| Revenue ($B) | $4.1 | $4.4 | $5.0 | +13% YoY |
| Gross Margin (%) | 26.8% | 31.1% | 31.6% | +480 bps |
| Operating Margin (%) | 6.6% | 11.4% | 13.6% | +700 bps |
*Values retrieved from S&P Global
The margin story is striking. Spotify's gross margin expanded nearly 500 basis points from Q4 2023 to Q3 2025, while operating margin more than doubled. This isn't just about price increases—it reflects operational discipline, podcast cost rationalization, and leverage on a scaled platform.
First Test for New Leadership
The timing is noteworthy. Daniel Ek stepped down as CEO on January 1, 2026, transitioning to Executive Chairman after 18 years running the company he founded. He handed day-to-day operations to co-CEOs Söderström (former Chief Product and Technology Officer) and Norström (former Chief Business Officer)—both Spotify veterans with over 15 years at the company.
Ek framed the transition as formalizing how Spotify has "already operated since 2023," with the co-presidents leading strategic and operational execution while he focuses on long-term strategy, capital allocation, and regulatory matters.
This price hike is the new leadership's first major public action—and it signals continuity rather than disruption. The playbook remains: add value, then adjust price.
Ask Fintool AI AgentMarket Position Holds
At $12.99, Spotify Premium now commands a meaningful premium over competitors. Apple Music costs $10.99, as does Amazon Music Unlimited. YouTube Music Premium sits at $13.99.
Despite being the most expensive mainstream option, Spotify dominates: 32% US market share versus Apple Music's 31% and Amazon's 22%. Globally, Spotify's lead is even wider—31.7% market share with nearly triple Apple Music's 94 million subscribers.
| Service | US Market Share | Global Subscribers | Monthly Price |
|---|---|---|---|
| Spotify | 32% | 281M | $12.99 |
| Apple Music | 31% | 94M | $10.99 |
| Amazon Music | 22% | 80M | $10.99 |
| YouTube Music | 7% | 125M | $13.99 |
Sources: Industry data aggregated from multiple reports
The question investors should ask: can Spotify keep raising prices without losing share? The evidence so far says yes. CFO Christian Luiga noted on the Q4 2024 call that "despite raising prices in more than 150 countries, the company has not observed any significant rise in customer churn."
What to Watch
Subscriber guidance in Q4 results. Spotify reports Q4 2025 earnings in early February. Management guided for 278 million Premium subscribers by Q2 2025 and delivered 281 million in Q3—beating expectations. The February price hike will first show up in Q1 2026 results.
ARPU trajectory. Average revenue per user has been a key growth driver alongside subscriber additions. The US price hike—in Spotify's largest market—should provide meaningful ARPU tailwind starting Q1 2026. Management highlighted that "ARPU gains associated with price increases" drove Premium revenue growth of 16% year-over-year in Q1 2025.
The path to 1 billion subscribers. In what may have been his last earnings call as CEO, Daniel Ek shared an audacious vision: "I don't see it impossible to get to 1 billion subscribers." Whether the new co-CEOs share that ambition—and how aggressively they pursue it—will shape Spotify's strategy for years to come.
Ask Fintool AI AgentRelated: Spotify-3.10%