Spotify’s Q4 Revenue Soars As Wrapped Drives User Base Growth
In Focus
- Spotify launched the “Wrapped” campaign towards the end of 2025
- The campaign generates statistics on user listening activities
- Over 300 million users engage with the Wrapped feature in Q4
Music streaming platform Spotify has reported significant growth in its user base this past quarter. According to TechCrunch, Spotify’s user growth was largely driven by its “Wrapped” campaign feature. Other new features launched on its free-tier service also contributed to the growth.
How Wrapped Campaign Increased Spotify’s User Base
The “Wrapped” marketing campaign generates statistics on top artists, songs, genres, podcasts, and total minutes listened throughout the year for users. The campaign, which launched towards the end of 2025, saw over 300 million users engaging with the Wrapped feature.
The platform also recorded 630 million shares on social media sites in more than 50 languages. Spotify’s free features adoption saw the platform onboard 38 million new users in Q4 of 2025. This growth brought the total number of monthly active users to 751 million users, representing an 11% increase from the previous year.
Spotify’s premium subscriber base grew by 10% to hit 290 million over the same period. News of user base growth pushed the music streaming company’s stock up 14% on February 10, 2026. The platform also generates Spotify AI playlists, allowing users to customize the music they wish to listen to.
Spotify’s Q4 Revenue Surpassed Market Expectations
As Spotify’s user base increased, its quarterly revenue grew 7% year-on-year. The music streaming company reported 4.53 billion euros, which is slightly higher than the expected 4.52 billion. This increase was attributed to an 8% growth in subscription revenue.
Spotify’s earnings per share also surpassed market expectations. The company reported 4.43 euros in earnings compared to the projected 2.74 euros. However, Spotify’s ad business dropped 4% to generate 518 million euros in the quarter under review.
Spotify’s gross margin improved by 83 basis points, to reach a high of 33.1% as the company sold more ads via music and podcasts. Gross margin is a critical metric for investors because it indicates improvements in profitability.
In recent years, the music streaming platform has made profitability a priority. To realize profits, Spotify has increased subscription fees in the U.S. and Europe, improved free ad-supported services, and introduced new features to give non-paying users more control. Additionally, the company has partnered with Netflix to introduce curated video podcasts on the video streaming platform.
Spotify’s Strong Future Outlook
Moving forward, Spotify expects its monthly active users to grow by 8 million to reach the 759 million mark, which is higher than the 752.4 million projected by analysts. The company also expects its premium subscriber base to reach 293 million.
In the current quarter, the music streaming firm expects revenues to remain stable at 4.5 billion euros. This is slightly lower than the 4.58 billion euros projected by the market.
