Spotify forecast first-quarter earnings above Wall Street estimates yesterday , as the Swedish streaming company benefits from strong user growth and price hikes, sending its shares up nearly 12 percent in premarket trading. The results are the first since co-CEOs Gustav Soderstrom and Alex Norstrom took the reins from founder Daniel Ek, who became executive chairman in January.

According to a Reuters report yesterday, while price increases in several markets and cost cuts powered profits in the December quarter, the company’s revenue growth hit the slowest since its 2018 market listing.

Spotify has rolled out an AI-powered playlist that can be generated with a simple prompt, invested in video podcasts, including through a Nteflix deal and expanded beyond audiobooks with physical books to ward off competition from Apple  and Amazon’s streaming services.

The company forecast operating income of 660 million euros ($786.13 million) in the first quarter, compared with analysts’ average estimate of 652.3 million euros, according to data compiled by LSEG.

Its quarterly revenue forecast of 4.5 billion euros was slightly below the estimate of 4.57 billion euros. Fourth-quarter revenue rose 7 percent to 4.53 billion euros, in line with estimates.

Fewer of Spotify‘s new users are coming from Europe and North America.

Spotify raised the price of its monthly premium subscription plan by $1 to $12.99 in the US, Estonia and Latvia markets this year, following a similar move in more than 150 markets in 2025.

Its quarterly outlook for 759 million monthly active users was above an estimate of 753 million, while its prediction for a 3 million increase in premium subscribers to 293 million was below estimates.

Premium subscribers grew 10 percent to 290 million in the fourth quarter, versus an estimate of 290.9 million. The company added record MAU net additions of 38 million, bringing the total to 751 million, thanks to Wrapped — its year-end roundup of users’ listening habits — that generates social media buzz and helps draw users to the service.

Gross profit jumped 10 percent from a year earlier, thanks to a 10 percent decline in operating expenses. Gross profit margin increased to 33.1 percent from 31.6 percent in the prior quarter.