UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934
For the month of July, 2024
Commission File Number: 001-38438
Spotify Technology S.A.
(Translation of registrant's name into English)
33 Boulevard Prince Henri
L-1724 Luxembourg
Grand Duchy of Luxembourg
(Address of principal executive office)
 
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.
Form 20-F  ☒    Form 40-F  ☐
 











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Spotify Technology S.A.
Interim condensed consolidated financial statements
For the three and six months ended June 30, 2024



Table of contents
 
  Page
  
 
 
 
 
 
 
 
 
 
  
 
 
 
 
 
 


PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
Interim condensed consolidated statement of operations
(Unaudited)
(in € millions, except share and per share data)
 
  Three months ended June 30,Six months ended June 30,
Note2024202320242023
Revenue203,807 3,177 7,443 6,219 
Cost of revenue2,695 2,411 5,327 4,687 
Gross profit1,112 766 2,116 1,532 
Research and development379 453 768 888 
Sales and marketing343 399 667 746 
General and administrative124 161 247 301 
846 1,013 1,682 1,935 
Operating income/(loss)266 (247)434 (403)
Finance income476 33 135 60 
Finance costs4(72)(27)(125)(104)
Finance income/(costs) - net4 6 10 (44)
Income/(loss) before tax270 (241)444 (447)
Income tax (benefit)/expense5(4)61 (27)80 
Net income/(loss) attributable to owners of the parent274 (302)471 (527)
Earnings/(loss) per share attributable to owners of the parent
Basic61.37 (1.55)2.37 (2.71)
Diluted61.33 (1.55)2.30 (2.71)
Weighted-average ordinary shares outstanding
Basic6199,959,172 194,420,128 198,985,721 193,993,664 
Diluted6206,119,851 194,420,128 205,123,767 193,993,664 
 
The accompanying notes are an integral part of the interim condensed consolidated financial statements.

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Interim condensed consolidated statement of comprehensive income/(loss)
(Unaudited)
(in € millions)
 
  Three months ended June 30,Six months ended June 30,
Note2024202320242023
Net income/(loss) attributable to owners of the parent274 (302)471 (527)
Other comprehensive income/(loss)
Items that may be subsequently reclassified to interim condensed consolidated statement of operations (net of tax):
Change in net unrealized gain or loss on short term investments13, 191 (1)(1)5 
Change in net unrealized gain or loss on cash flow hedging instruments13, 19(3)(5)(2)(7)
Change in foreign currency translation adjustment6 (9)28 (22)
Items not to be subsequently reclassified to interim condensed consolidated statement of operations (net of tax):
Gains/(losses) in the fair value of long term investments13, 19313 (94)565 (99)
Change in fair value of Exchangeable Notes due to change in the Group's credit risk15, 19— (10)(4)(10)
Other comprehensive income/(loss) for the
   period (net of tax)		317 (119)586 (133)
Total comprehensive income/(loss) for the period
   attributable to owners of the parent		591 (421)1,057 (660)
 
The accompanying notes are an integral part of the interim condensed consolidated financial statements.

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Interim condensed consolidated statement of financial position
(in € millions)
NoteJune 30, 2024December 31, 2023
(Unaudited) 
Assets  
Non-current assets  
Lease right-of-use assets7254 300 
Property and equipment8211 247 
Goodwill91,167 1,137 
Intangible assets968 84 
Long term investments191,931 1,215 
Restricted cash and other non-current assets1070 75 
Finance lease receivables752 — 
Deferred tax assets549 28 
3,802 3,086 
Current assets
Trade and other receivables11753 858 
Income tax receivable35 20 
Short term investments191,344 1,100 
Cash and cash equivalents4,054 3,114 
Other current assets12158 168 
6,344 5,260 
Total assets10,146 8,346 
Equity and liabilities
Equity
Share capital— — 
Other paid in capital5,637 5,155 
Treasury shares13(262)(262)
Other reserves132,595 1,812 
Accumulated deficit(3,711)(4,182)
Equity attributable to owners of the parent4,259 2,523 
Non-current liabilities
Exchangeable Notes15, 191,323 1,203 
Lease liabilities7472 493 
Accrued expenses and other liabilities1711 26 
Provisions183 3 
Deferred tax liabilities519 8 
1,828 1,733 
Current liabilities
Trade and other payables161,091 978 
Income tax payable17 12 
Deferred revenue657 622 
Accrued expenses and other liabilities172,223 2,440 
Provisions1824 21 
Derivative liabilities1947 17 
4,059 4,090 
Total liabilities5,887 5,823 
Total equity and liabilities10,146 8,346 
The accompanying notes are an integral part of the interim condensed consolidated financial statements.
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Interim condensed consolidated statement of changes in equity
(Unaudited)
(in € millions)
NoteShare
capital		Other paid in
capital		Treasury
Shares		Other
reserves		Accumulated
deficit		Equity attributable to
owners of the parent
Balance at January 1, 2024— 5,155 (262)1,812 (4,182)2,523 
Income for the period— — — — 197 197 
Other comprehensive income— — — 269 — 269 
Issuance of shares upon exercise of stock options, restricted stock units, and contingently issuable shares13— 242 — — — 242 
Restricted stock units withheld for employee taxes— — — (27)— (27)
Share-based compensation14— — — 69 — 69 
Income tax impact associated with share-based compensation5— — — 36 — 36 
Balance at March 31, 2024— 5,397 (262)2,159 (3,985)3,309 
Income for the period— — — — 274 274 
Other comprehensive income— — — 317 — 317 
Issuance of shares upon exercise of stock options and restricted stock units13— 240 — — — 240 
Restricted stock units withheld for employee taxes— — — (33)— (33)
Share-based compensation14— — — 81 — 81 
Income tax impact associated with share-based compensation5— — — 71 — 71 
Balance at June 30, 2024— 5,637 (262)2,595 (3,711)4,259 


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NoteShare
capital		Other paid in
capital		Treasury
Shares		Other
reserves		Accumulated
deficit		Equity attributable to
owners of the parent
Balance at January 1, 2023— 4,789 (262)1,521 (3,647)2,401 
Loss for the period— — — — (225)(225)
Other comprehensive loss— — — (14)— (14)
Reclassification of loss on sale of long term investments13— — — 3 (3)— 
Issuance of shares upon exercise of stock options, restricted stock units, and contingently issuable shares13— 75 — — — 75 
Restricted stock units withheld for employee taxes— — — (13)— (13)
Share-based compensation14— — — 105 — 105 
Income tax impact associated with share-based compensation5— — — 13 — 13 
Balance at March 31, 2023— 4,864 (262)1,615 (3,875)2,342 
Loss for the period— — — — (302)(302)
Other comprehensive loss— — — (119)— (119)
Issuance of shares upon exercise of stock options and restricted stock units13— 35 — — — 35 
Restricted stock units withheld for employee taxes— — — (19)— (19)
Share-based compensation14— — — 99 — 99 
Income tax impact associated with share-based compensation5— — — 18 — 18 
Balance at June 30, 2023— 4,899 (262)1,594 (4,177)2,054 

The accompanying notes are an integral part of the interim condensed consolidated financial statements.
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Interim condensed consolidated statement of cash flows
(Unaudited)
(in € millions)
  Six months ended June 30,
Note20242023
Operating activities  
Net income/(loss)471 (527)
Adjustments to reconcile net income/(loss) to net cash flows
Depreciation of property and equipment and lease right-of-use assets7, 843 61 
Amortization of intangible assets918 27 
Impairment charges on real estate assets7, 818 90 
Write-off of content assets12— 30 
Share-based compensation expense14150 202 
Finance income4(135)(60)
Finance costs4125 104 
Income tax (benefit)/expense5(27)80 
Other(1)(3)
Changes in working capital:
Decrease in trade receivables and other assets120 21 
(Decrease)/increase in trade and other liabilities(143)20 
Increase in deferred revenue28 24 
Increase/(decrease) in provisions184 (1)
Interest paid on lease liabilities7(18)(20)
Interest received78 49 
Income tax paid(28)(25)
Net cash flows from operating activities703 72 
Investing activities
Payment of deferred consideration pertaining to business combinations(10)(7)
Purchases of property and equipment8(7)(4)
Purchases of short term investments19(2,283)(375)
Sales and maturities of short term investments192,079 376 
Change in restricted cash101 (2)
Dividends received418 — 
Other(4)3 
Net cash flows used in investing activities(206)(9)
Financing activities
Proceeds from exercise of stock options14482 110 
Payments of lease liabilities7(39)(42)
Lease incentives received7— 2 
Payments for employee taxes withheld from restricted stock unit releases14(57)(29)
Net cash flows from financing activities386 41 
Net increase in cash and cash equivalents883 104 
Cash and cash equivalents at beginning of the period3,114 2,483 
Net foreign exchange gains/(losses) on cash and cash equivalents57 (37)
Cash and cash equivalents at June 304,054 2,550 
Supplemental disclosure of cash flow information
Non-cash investing and financing activities
Recognition of lease right-of-use asset in exchange for lease liabilities713 17 
Real estate assets disposed of in exchange for finance lease receivables7, 847 — 
Purchases of property and equipment in trade and other liabilities81 3 
Employee taxes withheld from restricted stock unit releases in trade and other liabilities143 3 

The accompanying notes are an integral part of the interim condensed consolidated financial statements.
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Notes to the interim condensed consolidated financial statements
(Unaudited)
1.Corporate information
Spotify Technology S.A. (the “Company” or “parent”) is a public limited company incorporated and domiciled in Luxembourg. The Company's registered office is 33 Boulevard Prince Henri, L-1724 Luxembourg, Grand Duchy of Luxembourg.
The principal activity of the Company and its subsidiaries (collectively, the “Group,” “we,” “us,” or “our”) is audio streaming. The Group’s premium service (“Premium Service”) provides users with unlimited online and offline high-quality streaming access to its catalog of music and podcasts. In select markets, the Premium Service provides eligible users with limited online and offline streaming access to its catalog of audiobooks. The Premium Service offers a music listening experience without commercial breaks. The Group’s ad-supported service (“Ad-Supported Service” and together with the Premium Service and other subscription offerings, the “Service”) has no subscription fees and provides users with limited on-demand online access to the catalog of music and unlimited online and offline access to the catalog of podcasts. The Group depends on securing content licenses from a number of major and minor content owners and other rights holders in order to provide its service.
2.Basis of preparation and summary of material accounting policies
The interim condensed consolidated financial statements of Spotify Technology S.A. for the three and six months ended June 30, 2024 and 2023 have been prepared in accordance with IAS 34 Interim Financial Reporting as issued by the International Accounting Standards Board (“IASB”). The interim financial information is unaudited. The interim financial information reflects all normal recurring adjustments that are, in the opinion of management, necessary to fairly present the information set forth herein. The interim condensed consolidated financial statements should be read in conjunction with the Group's consolidated financial statements for the year ended December 31, 2023, as they do not include all the information and disclosures required in the annual consolidated financial statements. Interim results are not necessarily indicative of the results for a full year. The interim condensed consolidated financial statements are presented in millions of Euros.
New and amended standards and interpretations adopted by the Group
Classification of Liabilities as Current or Non-current and Non-current Liabilities with Covenants - Amendments to IAS 1
On January 1, 2024, the Group adopted the IASB issued amendments to paragraphs 69 to 76 of IAS 1 Presentation of Financial Statements to specify the requirements for classifying liabilities as current or non-current. The amendments are applied on a retrospective basis and require the Group to reclassify the Exchangeable Notes (as defined below) as a current liability if the exchange conditions are met, even if no noteholder actually requires us to exchange their notes. Adoption of this amendment did not result in the reclassification of the Exchangeable Notes as a current liability at any reporting date, from the inception of the Exchangeable Notes to June 30, 2024, as the exchange conditions had not been met.
There are no other new International Financial Reporting Standards (“IFRS”) or IFRS Interpretation Committee (“IFRIC”) interpretations effective during the six months ended June 30, 2024 that have a material impact to the interim condensed consolidated financial statements.
New standards and interpretations issued not yet effective
Presentation and Disclosure in Financial Statements - IFRS 18
In April 2024, the IASB issued IFRS 18 Presentation and Disclosure in Financial Statements (“IFRS 18”) which replaces IAS 1 Presentation of Financial Statements. IFRS 18 requires an entity to classify all income and expenses within its statement of profit or loss into one of five categories: operating; investing; financing; income taxes; and discontinued operations. The first three categories are new. These categories are complemented by the requirement to present subtotals and totals for “operating profit or loss,” “profit or loss before financing income and taxes,” and “profit or loss.” IFRS 18, and the amendments to the other standards, is effective for reporting periods beginning on or after January 1, 2027, but earlier application is permitted. The Group is currently evaluating the impact of this new standard.
Classification and Measurement of Financial Instruments - Amendments to IFRS 9 and IFRS 7
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In May 2024, the IASB issued amendments to IFRS 9 and IFRS 7, Amendments to the Classification and Measurement of Financial Instruments. The amendments clarify that a financial liability is derecognized on the “settlement date,” which is when the related obligation is discharged, canceled, expired or the liability otherwise qualifies for derecognition. The amendments also clarify how to assess the contractual cash flow characteristics of financial assets that include environmental, social and governance (“ESG”)-linked features and other similar contingent features, and the treatment of non-recourse assets and contractually linked instruments. In addition, the amendments require additional disclosures in IFRS 7 for financial assets and liabilities with contractual terms that reference a contingent event (including those that are ESG-linked), and equity instruments classified at fair value through other comprehensive income. The amendments will be effective for annual reporting periods beginning on or after January 1, 2026, but earlier application is permitted. The Group is currently evaluating the impact of these amendments.
There are no other IFRS or IFRIC interpretations that are not yet effective and that are expected to have a material impact to the interim condensed consolidated financial statements.
3.Critical accounting estimates and judgments
In preparing these interim condensed consolidated financial statements, the significant judgments made by management in applying the Group's accounting policies and the key sources of estimation and uncertainty were the same as those applied to the consolidated financial statements for the year ended December 31, 2023.
Estimates and judgments are continually evaluated and are based on historical experience and other factors, including expectations of future events.
4.Finance income and costs
 Three months ended June 30,Six months ended June 30,
 2024202320242023
 (in € millions)
Finance income  
Fair value movements on derivative liabilities (Note 19)— 1 — 1 
Interest income52 30 97 56 
Interest income on finance lease receivables1 — 2 — 
Dividend income18 — 18 — 
Other finance income5 2 10 3 
Foreign exchange gains — — 8 — 
Total76 33 135 60 
Finance costs
Fair value movements on derivative liabilities (Note 19)(18)— (26)(7)
Fair value movements on Exchangeable Notes (Note 19)(43)(5)(78)(48)
Interest expense on lease liabilities(9)(10)(18)(20)
Other finance costs(2)(2)(3)(6)
Foreign exchange losses— (10)— (23)
Total(72)(27)(125)(104)
5.Income tax
The effective tax rates for the three months ended June 30, 2024 and 2023 were (1.6)% and (25.1)%, respectively. The effective tax rates for the six months ended June 30, 2024 and 2023 were (6.1)% and (17.8)%, respectively. The Group operates in a global environment with significant operations in various jurisdictions outside Luxembourg. Accordingly, the consolidated income tax rate is a composite rate reflecting the Group's earnings and the applicable tax rates in the jurisdictions where the Group operates.
For the three months ended June 30, 2024, the income tax benefit of €4 million was due primarily to the recognition of deferred tax assets as a result of the increase in the unrealized gain on the Group’s long-term investment in Tencent Music Entertainment Group (“TME”) of €53 million, offset by €38 million of income tax expense which arose because the excess tax benefit of share-based compensation deductions was recognized in equity and €10 million of income taxes payable associated with entities in a taxable profit position. For the three months ended June 30, 2023, the income tax expense of €61 million was
- 8 -
due primarily to €26 million of deferred tax expense related to the derecognition of deferred tax assets as a result of the decrease in unrealized gain on the Group’s long-term investment in TME, €17 million of income tax expense which arose because the excess tax benefit of share-based compensation deductions was recognized in equity, as well as €12 million of income taxes payable associated with entities in a taxable profit position.
For the six months ended June 30, 2024, the income tax benefit of €27 million was due primarily to the recognition of deferred tax assets as a result of the increase in unrealized gain on the Group's long-term investment in TME of €117 million, offset by €64 million of income tax expense which arose because the excess tax benefit of share-based compensation deductions was recognized in equity and €16 million of income taxes payable associated with entities in a taxable profit position. For the six months ended June 30, 2023, the income tax expense of €80 million was due primarily to the derecognition of deferred tax assets resulting from the decrease in the unrealized gain on the Group’s long term investment in TME of €28 million, €23 million of income tax expense which arose because the excess tax benefit of share-based compensation deductions was recognized in equity, as well as €19 million of income taxes payable associated with entities in a taxable profit position.
Transactions recorded through other comprehensive income/(loss) have been shown net of their tax impact, as applicable.
The Group is in scope of the OECD Pillar 2 Model Rules (“P2 Rules”). The P2 Rules have been enacted (or substantively enacted) in most jurisdictions in which the Group operates, including Luxembourg and Sweden. Although no material exposure arising from Pillar 2 has been identified to date, material Pillar 2 impacts to our tax expense remain possible.
We are subject to ongoing tax audits in several jurisdictions, and most of these audits involve transfer pricing matters. Tax authorities in certain jurisdictions have challenged our tax positions. We regularly assess the likely outcomes of these audits, taking into account any new information available, in order to determine the appropriateness of the tax reserves. If management concludes that it is not probable that a tax position will be accepted, the effect of that uncertainty is reflected at either the most likely amount or the expected value, taking into account a range of possible outcomes. An Advance Pricing Agreement ("APA") with the United States government was executed in July 2024 for the tax years 2014 through 2021 covering various transfer pricing matters. The conclusion of this APA did not have a material impact.
Tax provisions related to uncertain tax positions in the interim condensed consolidated statement of financial position, which management has concluded are not probable to be accepted were €14 million as of June 30, 2024 and €8 million as of December 31, 2023. None of the provisions related to uncertain tax positions are reasonably expected to be resolved within the next 12 months. Interest and penalties included in income tax expense were not material in any of the periods presented. Due to the uncertainty associated with our tax positions, any future agreement with the tax authorities could have a significant impact on our results of operations, financial condition, and cash flows.
Net deferred tax assets of €30 million and €20 million have been recorded in the interim condensed consolidated statement of financial position as of June 30, 2024 and December 31, 2023, respectively. In evaluating the probability of realizing deferred tax assets, the Group considered all available positive and negative evidence of realizability, primarily past operating results. As of June 30, 2024 and December 31, 2023, deferred tax assets of €791 million and €796 million have not been recognized. Changes in profitability, in the jurisdictions where these balances originated, among other factors, could have a substantial impact on management’s assessment of deferred tax recognition.
6.Earnings/(loss) per share
Basic earnings/(loss) per share is computed using the weighted-average number of outstanding ordinary shares during the period. Diluted earnings/(loss) per share is computed using the weighted-average number of outstanding ordinary shares and potential outstanding ordinary shares during the period. Potential ordinary shares, which are based on the weighted-average ordinary shares underlying outstanding stock options, restricted stock units, other contingently issuable shares, warrants, and Exchangeable Notes and computed using the treasury stock method or the if-converted method, as applicable, are included when calculating diluted earnings/(loss) per share when their effect is dilutive. The computation of earnings/(loss) per share for the respective periods is as follows:
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 Three months ended June 30,Six months ended June 30,
 2024202320242023
 (in € millions, except share and per share data)
Basic earnings/(loss) per share  
Net income/(loss) attributable to owners of the parent274 (302)471 (527)
Shares used in computation:
Weighted-average ordinary shares outstanding199,959,172 194,420,128 198,985,721 193,993,664 
Basic earnings/(loss) per share
   attributable to owners of the parent		1.37 (1.55)2.37 (2.71)
Diluted earnings/(loss) per share
Net income/(loss) attributable to owners of the parent274 (302)471 (527)
Net income/(loss) used in the computation
   of diluted earnings/(loss) per share		274 (302)471 (527)
Shares used in computation:
Weighted-average ordinary shares outstanding199,959,172 194,420,128 198,985,721 193,993,664 
Stock options4,216,472 — 4,122,911 — 
Restricted stock units1,925,727 — 1,993,421 — 
Other contingently issuable shares18,480 — 21,714 — 
Diluted weighted-average ordinary shares206,119,851 194,420,128 205,123,767 193,993,664 
Diluted earnings/(loss) per share
   attributable to owners of the parent		1.33 (1.55)2.30 (2.71)
Potential dilutive securities that were not included in the diluted earnings/(loss) per share calculations because they would be anti-dilutive were as follows:
Three months ended June 30,Six months ended June 30,
2024202320242023
Stock options1,429,580 15,739,427 1,601,086 15,739,427 
Restricted stock units2,439 3,476,096 6,829 3,476,096 
Other contingently issuable shares— 36,898 — 36,898 
Warrants800,000 800,000 800,000 800,000 
Exchangeable Notes2,911,500 2,911,500 2,911,500 2,911,500 
7.Leases
The Group leases certain properties under non-cancellable lease agreements that primarily relate to office space. The expected remaining lease terms are up to 10 years.
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Below is the roll-forward of lease right-of-use assets:
Right-of-use assets 
 (in € millions)
Cost 
At January 1, 2024684 
Increases13 
Decreases(172)
Exchange differences11 
At June 30, 2024536 
Accumulated depreciation and impairment loss
At January 1, 2024(384)
Depreciation charge(22)
Impairment charge(12)
Decreases142 
Exchange differences(6)
At June 30, 2024(282)
Cost, net accumulated depreciation and impairment loss
At January 1, 2024300 
At June 30, 2024254 
During the six months ended June 30, 2024, we recorded €12 million of impairment charges for right-of-use assets in connection with our strategic decision to reduce our real estate footprint in certain locations and initiate subleases of these leased office spaces (“Office Space Optimization Initiative”).
Below is the roll-forward of lease liabilities:
Lease liabilities20242023
(in € millions)
At January 1558 613 
Increases13 17 
Payments (1)
(57)(62)
Interest expense18 20 
Lease incentives received (2)
— 2 
Exchange differences11 (14)
At June 30543 576 
(1) €18 million and €20 million of interest paid on lease liabilities are included in operating activities and €39 million and €42 million of payments of lease liabilities included in financing activities within the interim condensed consolidated statement of cash flows for the six months ended June 30, 2024 and 2023, respectively.
(2) €2 million of lease incentives received are included in financing activities within the interim condensed statement of cash flows for the six months ended June 30, 2023. There were no lease incentives received during the six months ended June 30, 2024.

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Below is the maturity analysis of lease liabilities:
Lease liabilitiesJune 30, 2024
Maturity Analysis(in € millions)
Less than one year105 
One to five years336 
More than five years273 
Total lease commitments714 
Impact of discounting remaining lease payments(171)
Total lease liabilities543 
Lease liabilities included in the interim condensed consolidated
   statement of financial position
Current71 
Non-current472 
Total543 
Excluded from the lease commitments above are short term leases. Expenses relating to short term leases were approximately €1 million for both the three months ended June 30, 2024 and 2023, and €2 million for both the six months ended June 30, 2024 and 2023, respectively. Additionally, the Group has entered into certain lease agreements with approximately €40 million of commitments, which had not commenced as of June 30, 2024, and, as such, have not been recognized in the interim condensed consolidated statement of financial position.
The weighted-average incremental borrowing rate applied to lease liabilities recognized in the interim condensed consolidated statement of financial position as of June 30, 2024 was 6.4%.
During the six months ended June 30, 2024, the Group entered into agreements to sublease a portion of its leased offices under finance leases. As an intermediate lessor, the Group accounts for sublease arrangements separately from the related head lease agreements. Subleases are classified as either finance or operating leases by reference to the right-of-use asset arising from the head lease. Where the lease transfers substantially all the risks and rewards of ownership to the lessee, the contract is classified as a finance lease; all other leases are classified as operating leases. Amounts due from lessees under finance subleases are recognized as receivables discounted using the interest rate implicit in the lease. Below is the roll-forward of finance lease receivables:
Finance lease receivables20242023
(in € millions)
At January 1— — 
Additions51 — 
Interest income2 — 
At June 3053 — 
- 12 -
Below is the maturity analysis of finance lease receivables:
Finance lease receivablesJune 30, 2024
Maturity Analysis(in € millions)
Less than one year1 
One to five years38 
More than five years49 
Total lease payments receivable88 
Unearned finance income(35)
Total finance lease receivables53 
Finance lease receivables included in the interim condensed consolidated
   statement of financial position
Current1 
Non-current52 
Total53 
8.Property and equipment
Property and equipmentLeasehold
improvements		Total
 (in € millions)
Cost   
At January 1, 202493 444 537 
Additions2 1 3 
Disposals(4)(55)(59)
Exchange differences3 9 12 
At June 30, 202494 399 493 
Accumulated depreciation and impairment loss
At January 1, 2024(79)(211)(290)
Depreciation charge(5)(16)(21)
Impairment charge— (6)(6)
Disposals4 37 41 
Exchange differences(1)(5)(6)
At June 30, 2024(81)(201)(282)
Cost, net accumulated depreciation and impairment loss
At January 1, 202414 233 247 
At June 30, 202413 198 211 
During the six months ended June 30, 2024, we recorded €6 million of impairment charges for leasehold improvements in connection with the Office Space Optimization Initiative. The Group had €2 million and €4 million of leasehold improvements that were not placed into service as of June 30, 2024 and December 31, 2023, respectively. 
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9.Goodwill and intangible assets
 Internal
development
costs and
patents		Acquired
intangible
assets		TotalGoodwillTotal
 (in € millions)
Cost     
At January 1, 202468 168 236 1,137 1,373 
Additions2 — 2 — 2 
Derecognition of fully amortized intangibles(2)(23)(25)— (25)
Exchange differences— 2 2 30 32 
At June 30, 202468 147 215 1,167 1,382 
Accumulated amortization
At January 1, 2024(55)(97)(152)— (152)
Amortization charge(4)(14)(18)— (18)
Derecognition of fully amortized intangibles2 23 25 — 25 
Exchange differences— (2)(2)— (2)
At June 30, 2024(57)(90)(147)— (147)
Cost, net accumulated amortization
At January 1, 202413 71 84 1,137 1,221 
At June 30, 202411 57 68 1,167 1,235 
Amortization charges related to intangible assets of €7 million and €9 million are included in research and development in the interim condensed consolidated statement of operations during the three months ended June 30, 2024 and 2023, respectively. Amortization charges related to intangible assets of €15 million and €19 million are included in research and development in the interim condensed consolidated statement of operations during the six months ended June 30, 2024 and 2023, respectively. There were no impairment charges for goodwill and no material impairment charges for intangible assets for the three and six months ended June 30, 2024 and 2023, respectively.
10.Restricted cash and other non-current assets
June 30, 2024December 31, 2023
(in € millions)
Restricted cash  
Lease deposits and guarantees48 50 
Other1 1 
Other non-current assets21 24 
Total70 75 
11.Trade and other receivables
 June 30, 2024December 31, 2023
 (in € millions)
Trade receivables548 607 
Less: allowance for expected credit losses(3)(5)
Trade receivables - net545 602 
Other receivables208 256 
Total753 858 
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12.Other current assets
June 30, 2024December 31, 2023
(in € millions)
Content assets73 95 
Prepaid expenses and other 74 64 
Derivative assets11 9 
Total158 168 
Content asset amortization of €52 million and €53 million is included in cost of revenue in the interim condensed consolidated statement of operations for the three months ended June 30, 2024 and 2023, respectively. Content asset amortization of €103 million is included in cost of revenue in the interim condensed consolidated statement of operations for both the six months ended June 30, 2024 and 2023.
13.Equity and other reserves
As of June 30, 2024 and December 31, 2023, the Company had 204,256,242 and 201,343,630 ordinary shares issued and fully paid, respectively, with 3,448,071 and 4,200,241 ordinary shares held as treasury shares, respectively.
On August 20, 2021, the Company announced that the board of directors had approved a program to repurchase up to $1.0 billion of the Company’s ordinary shares. Repurchases of up to 10,000,000 of the Company’s ordinary shares were authorized at the Company’s general meeting of shareholders on April 21, 2021. The repurchase program will expire on April 21, 2026. Since the commencement of this repurchase program and through June 30, 2024, 469,274 ordinary shares were repurchased for €91 million under this program.
For the three and six months ended June 30, 2024, the Company issued and repurchased 2,000,000 and 2,900,000 of its own ordinary shares, respectively, from its Netherlands subsidiary at par value. For the three and six months ended June 30, 2024, the Company reissued 1,754,106 and 3,652,170 treasury shares, respectively, upon the exercise of stock options and vesting of restricted stock units.
For the three and six months ended June 30, 2023, the Company issued and repurchased 700,000 of its own ordinary shares from its Netherlands subsidiary at par value. For the three and six months ended June 30, 2023, the Company reissued 511,676 and 1,347,969 treasury shares, respectively, upon the exercise of stock options, vesting of restricted stock units and contingently issuable shares.
As of June 30, 2024 and December 31, 2023, the Group's founders held 337,341,690 and 343,841,690 beneficiary certificates, respectively.
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Other reserves
 20242023
 (in € millions)
Currency translation  
At January 163 100 
Currency translation28 (22)
At June 3091 78 
Short term investments
At January 1(4)(18)
Losses on fair value that may be subsequently reclassified to interim condensed consolidated statement of operations(10)— 
Losses reclassified to interim condensed consolidated statement of operations9 6 
Deferred tax— (1)
At June 30(5)(13)
Long term investments
At January 1224 161 
Gains/(Losses) on fair value not to be subsequently reclassified to interim condensed consolidated statement of operations712 (124)
Losses on sale of long term investment reclassified to accumulated deficit— 3 
Deferred tax(147)25 
At June 30789 65 
Exchangeable Notes
At January 1(7)3 
Losses on fair value attributable to changes in credit risk(5)(14)
Deferred tax1 4 
At June 30(11)(7)
Cash flow hedges
At January 1(3)10 
(Losses)/Gains on fair value that may be subsequently reclassified to interim condensed consolidated statement of operations(6)3 
Losses/(Gains) reclassified to revenue13 (35)
(Gains)/Losses reclassified to cost of revenue(10)23 
Deferred tax1 2 
At June 30(5)3 
Share-based compensation
At January 11,539 1,265 
Share-based compensation150 204 
Income tax impact associated with share-based compensation107 31 
Restricted stock units withheld for employee taxes(60)(32)
At June 301,736 1,468 
Other reserves at June 302,595 1,594 
- 16 -
14.Share-based compensation
The expense recognized in the interim condensed consolidated statement of operations for share-based compensation is as follows:
  Three months ended June 30,Six months ended June 30,
 2024202320242023
 (in € millions)
Cost of revenue2 1 3 3 
Research and development47 60 86 125 
Sales and marketing18 21 34 41 
General and administrative15 15 27 33 
Total82 97 150 202 
Activity in the Group's RSUs and other contingently issuable shares outstanding and related information is as follows:
 RSUsOther
 Number of
RSUs		Weighted
average
grant date
fair value		Number of
Awards		Weighted
average
grant date
fair value
  US$ US$
Outstanding at January 1, 20242,554,925132.39 36,898155.83 
Granted634,307260.70 —— 
Forfeited(70,849)159.43 —— 
Released(601,647)151.76 (14,596)154.15 
Outstanding at June 30, 20242,516,736159.37 22,302156.93 
In the table above, the number of RSUs and other contingently issuable shares released include ordinary shares that the Group has withheld for settlement of employees' tax obligations due upon the vesting of RSUs and other contingently issuable shares. For most of our employees, when RSUs vest, the Group withholds the number of shares that are equal to the monetary value of the employee’s tax obligation from the total number of shares that otherwise would have been issued. The Group then remits cash to tax authorities on the employees' behalf. If all the RSUs outstanding at June 30, 2024 subsequently vest, the Group estimates that it would be required to remit approximately €273 million to tax authorities over the vesting period for the years 2024 through 2028. In determining this estimate, the Group used the Company's ordinary share price as at June 30, 2024. The actual amount remitted to tax authorities is dependent on the Company's ordinary share price on each of the vesting dates, as well as the number of awards that ultimately vest.
Activity in the Group's stock options outstanding and related information is as follows:
  Options
 Number of
options		Weighted
average
exercise price
  US$
Outstanding at January 1, 202412,429,245165.93 
Granted597,800271.67 
Forfeited(145,841)165.47 
Exercised(3,321,213)157.70 
Expired(165,980)301.32 
Outstanding at June 30, 20249,394,011173.18 
Exercisable at January 1, 20245,793,791184.98 
Exercisable at June 30, 20243,883,933195.50 
The weighted-average contractual life for the stock options outstanding at June 30, 2024 was 2.8 years. The weighted-average share price at exercise for options exercised during the six months ended June 30, 2024 was US$273.53. The weighted-average fair value of options granted during the six months ended June 30, 2024 was US$116.48 per option.
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The following table lists the inputs to the Black-Scholes option-pricing models used for share-based compensation for the three and six months ended June 30, 2024 and 2023:
 Three months ended June 30,Six months ended June 30,
 2024202320242023
Expected volatility (%)53.8 - 56.051.5 - 58.853.7 - 57.651.5 - 61.2
Risk-free interest rate (%)4.4 - 4.93.6 - 4.13.8 - 4.93.5 - 4.7
Expected life of stock options (years)2.6 - 4.82.6 - 4.82.6 - 4.82.6 - 4.8
Weighted-average share price (US$)302.05 145.58 265.67 110.26 
15.Exchangeable Notes
On March 2, 2021, the Company’s wholly owned subsidiary, Spotify USA Inc. (the “Issuer”), issued US$1,500 million aggregate principal amount of 0% Exchangeable Senior Notes due 2026 (the “Exchangeable Notes”), which included the initial purchasers’ exercise in full of their option to purchase an additional US$200 million principal amount of the Exchangeable Notes. The Exchangeable Notes will mature on March 15, 2026, unless earlier repurchased, redeemed or exchanged. The Exchangeable Notes are fully and unconditionally guaranteed, on a senior, unsecured basis by the Company.
The net proceeds from the issuance of the Exchangeable Notes were €1,223 million after deducting transaction costs of €18 million. The transaction costs were immediately expensed and included in finance costs in the interim condensed consolidated statement of operations for the three months ended March 31, 2021.
The Exchangeable Notes are the Issuer’s senior unsecured obligations and are equal in right of payment with the Issuer's future senior, unsecured indebtedness, senior in right of payment to the Issuer’s future indebtedness that is expressly subordinated to the Exchangeable Notes and effectively subordinated to the Issuer’s future secured indebtedness, to the extent of the value of the collateral securing that indebtedness. The Exchangeable Notes will be structurally subordinated to all future indebtedness and other liabilities, including trade payables, and (to the extent the Issuer is not a holder thereof) preferred equity, if any, of the Issuer’s subsidiaries.
The noteholders may exchange their Exchangeable Notes at their option into consideration that consists, at the Issuer’s election, of cash, ordinary shares of the Company, or a combination of cash and ordinary shares, but only under certain circumstances as set forth in the indenture governing the Exchangeable Notes (the “Indenture”). The circumstances required to allow the noteholders to exchange their Exchangeable Notes were not met during the six months ended June 30, 2024.
The Exchangeable Notes were not redeemable prior to March 20, 2024, except in the event of certain tax law changes as set forth in the Indenture. As of March 20, 2024, the Exchangeable Notes are redeemable, in whole or in part, at the Issuer’s option at any time, and from time to time, and on or before the 40th scheduled trading day immediately before the maturity date, at a cash redemption price equal to the principal amount of the Exchangeable Notes to be redeemed, plus accrued and unpaid special and additional interest, if any, but only if the last reported sale price per ordinary share exceeds 130% of the exchange price on:
(1) each of at least 20 trading days, whether or not consecutive, during the 30 consecutive trading days ending on, and including, the trading day immediately before the date the Issuer sends the related redemption notice; and
(2) the trading day immediately before the date the Issuer sends such notice.
In addition, the Issuer will have the right to redeem all, but not less than all, of the Exchangeable Notes if certain changes in tax law as set forth in the Indenture occur. In addition, calling any Exchangeable Note for redemption will constitute a make-whole fundamental change with respect to that Exchangeable Note, in which case the exchange rate applicable to the exchange of that Exchangeable Note will be increased in certain circumstances if it is exchanged after it is called for redemption.
Upon the occurrence of a “fundamental change” as set forth in the Indenture, noteholders may require the Issuer to repurchase their Exchangeable Notes at a cash repurchase price equal to the principal amount of the Exchangeable Notes to be repurchased, plus accrued and unpaid special and additional interest, if any, to, but excluding, the fundamental change repurchase date as set forth in the Indenture.
The Group accounted for the Exchangeable Notes at fair value through profit and loss using the fair value option in accordance with IFRS 9, Financial Instruments. The fair value of the Exchangeable Notes as of June 30, 2024 was $1,323 million. See Note 19 for information regarding the key inputs and assumptions used to estimate the fair value of the Exchangeable Notes.
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16.Trade and other payables
  June 30, 2024December 31, 2023
 (in € millions)
Trade payables750 662 
Value added tax and sales taxes payable311 291 
Other current liabilities30 25 
Total1,091 978 
17.Accrued expenses and other liabilities
 June 30, 2024December 31, 2023
 (in € millions)
Non-current  
Other accrued liabilities11 26 
Total11 26 
Current
Accrued fees to rights holders1,678 1,826 
Accrued salaries, vacation, and related taxes135 273 
Accrued social costs for options and RSUs152 57 
Accrued operating liabilities134 163 
Other accrued expenses124 121 
Total2,223 2,440 
On December 4, 2023, the Company announced a reduction in force, through which our employee base was reduced by approximately 17%. As of December 31, 2023, we had accrued employee severance costs related to the reduction in force of €136 million included within current accrued expenses and other liabilities. As of June 30, 2024, we have substantially settled our obligations related to the reduction in force.
18.Provisions
 Legal
contingencies		Indirect taxOnerous ContractsOtherTotal
 (in € millions)
Carrying amount at January 1, 202411 8 1 4 24 
Charged/(credited) to the interim condensed statement of operations:
Additional provisions6 1 — — 7 
   Utilized— — (1)— (1)
Reversal of unutilized amounts(2)(1)— — (3)
Carrying amount at June 30, 202415 8 — 4 27 
As at January 1, 2024
Current portion11 8 1 1 21 
Non-current portion— — — 3 3 
As at June 30, 2024
Current portion15 8 — 1 24 
Non-current portion— — — 3 3 
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Various legal actions, proceedings, and claims are pending or may be instituted or asserted against the Group. The results of such legal proceedings are difficult to predict and the extent of the Group's financial exposure is difficult to estimate. The Group records a provision for contingent losses when it is both probable that a liability has been incurred, and the amount of the loss can be reasonably estimated.
As of April 2019, Spotify USA Inc.'s settlement of the Ferrick et al. v. Spotify USA Inc., No. 1:16-cv-8412-AJN (S.D.N.Y.), putative class action lawsuit, which alleged that Spotify USA Inc. unlawfully reproduced and distributed musical compositions without obtaining licenses, was final and effective. Even with the effectiveness of the settlement, we may still be subject to claims of copyright infringement by rights holders who have purported to opt out of the settlement or who may not otherwise be covered by its terms. The Music Modernization Act of 2018 contains a limitation of liability with respect to such lawsuits filed on or after January 1, 2018. Rights holders may, nevertheless, file lawsuits, and may argue that they should not be bound by this limitation of liability. For example, in August 2019, the Eight Mile Style, LLC et al v. Spotify USA Inc., No. 3:19-cv-00736-AAT, lawsuit was filed against Spotify USA Inc. in the U.S. District Court for the Middle District of Tennessee, alleging both that Spotify USA Inc. does not qualify for the limitation of liability in the Music Modernization Act and that the limitation of liability is unconstitutional and, thus, not valid law. We intend to vigorously defend this lawsuit, including plaintiffs' challenges to the limitation of liability in the Music Modernization Act.
19.Financial instruments
Foreign exchange forward contracts
Cash flow hedges
The Group's currency pairs used for cash flow hedges are Euro / U.S. dollar, Euro / Australian dollar, Euro / British pound, Euro / Swedish krona, Euro / Canadian dollar, and Euro / Norwegian krone. The notional principal of foreign exchange contracts hedging the revenue and cost of revenue line items in the interim condensed consolidated statement of operations was approximately €1,556 million and €1,002 million, respectively, as of June 30, 2024, and approximately €1,414 million and €991 million, respectively, as of December 31, 2023.
Fair values
The carrying amounts of certain financial instruments, including cash and cash equivalents, trade and other receivables, restricted cash, trade and other payables, and accrued expenses and other liabilities approximate fair value due to their relatively short maturities. The Group measures its finance lease receivables as described in Note 7. The carrying amount of our finance lease receivables is considered to approximate their fair value at June 30, 2024. Refer to the consolidated financial statements for the year ended December 31, 2023 for information regarding the Group's measurement of its lease liabilities. All other financial assets and liabilities are accounted for at fair value.
- 20 -
The following tables summarize, by major security type, the Group's financial assets and liabilities that are measured at fair value on a recurring basis, and the category using the fair value hierarchy:
 Quoted Prices in Active
Markets for
Identical Assets
(Level 1)		Significant Other
Observable Inputs
(Level 2)		Significant Unobservable Inputs (Level 3)June 30, 2024
 (in € millions)
Financial assets at fair value    
Cash equivalents:
Money market funds3,063 — — 3,063 
Short term investments:    
Money market funds184 — — 184 
Government securities261 7 — 268 
Corporate notes— 331 — 331 
Collateralized reverse purchase agreements— 448 — 448 
Fixed income funds113 — — 113 
Derivatives (designated for hedging):
Foreign exchange forwards— 11 — 11 
Long term investments1,855 — 76 1,931 
Total financial assets at fair value5,476 797 76 6,349 
Financial liabilities at fair value
Exchangeable Notes— — 1,323 1,323 
Derivatives (not designated for hedging):
Warrants— — 29 29 
Derivatives (designated for hedging):
Foreign exchange forwards— 18 — 18 
Total financial liabilities at fair value— 18 1,352 1,370 
- 21 -
 Quoted Prices in Active
Markets for
Identical Assets
(Level 1)		Significant Other
Observable Inputs
(Level 2)		Significant Unobservable Inputs (Level 3)December 31, 2023
 (in € millions)
Financial assets at fair value    
Cash equivalents:
Money market funds2,111 — — 2,111 
Short term investments:    
Money market funds181 — — 181 
Government securities239 8 — 247 
Corporate notes— 320 — 320 
Collateralized reverse purchase agreements— 241 — 241 
Fixed income funds111 — — 111 
Derivatives (designated for hedging):
Foreign exchange forwards— 9 — 9 
Long term investments1,154 — 61 1,215 
Total financial assets at fair value3,796 578 61 4,435 
Financial liabilities at fair value
Exchangeable Notes— — 1,203 1,203 
Derivatives (not designated for hedging):
Warrants— — 3 3 
Derivatives (designated for hedging):
Foreign exchange forwards— 14 — 14 
Total financial liabilities at fair value— 14 1,206 1,220 
The Group's policy is to recognize transfers into and transfers out of fair value hierarchy levels at the end of each reporting period. During the six months ended June 30, 2024, there were no transfers between levels in the fair value hierarchy.
Recurring fair value measurements
Long term investment - Tencent Music Entertainment Group
The Group's approximate 8% investment in TME is carried at fair value through other comprehensive income/(loss). The fair value of ordinary shares of TME is based on the ending New York Stock Exchange American depository share price. The fair value of the investment in TME may vary over time and is subject to a variety of risks including company performance, macro-economic, regulatory, industry, USD to Euro exchange rate and systemic risks of the equity markets overall.
The table below presents the changes in the investment in TME:
 20242023
(in € millions)
At January 11,154 1,094 
Changes in fair value recorded in other comprehensive income/(loss)701 (137)
At June 301,855 957 
A 10% decrease or increase in TME's share price would have resulted in a fair value of the Group's long term investment in TME ranging from €1,669 million to €2,040 million at June 30, 2024.
The following sections describe the valuation methodologies the Group uses to measure its Level 3 financial instruments at fair value on a recurring basis.
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Long term investments - other
The Group has interests in certain long term investments, the most significant of which is our equity investment in DistroKid, an independent digital music distribution service. These long term investments primarily represent unlisted equity securities carried at fair value through other comprehensive income/(loss). The fair values of these equity investments are generally determined using business enterprise values based on market transactions or by (i) applying market multiples to the projected financial performance and (ii) discounting the future value to its present value equivalent. The key assumptions used to estimate the fair value of these equity investments include market multiples of revenue or earnings before interest, income taxes, depreciation and amortization for benchmark companies used to estimate business enterprise value and discount rate.
The fair value of the long term investments may vary over time and is subject to a variety of risks including company performance, macroeconomic, regulatory, industry, USD to Euro exchange rate, and systemic risks of the overall equity markets.
The table below presents the changes in the other long term investments:
20242023
(in € millions)
At January 161 43 
Initial recognition of long term investment1 2 
Changes in fair value recorded in other comprehensive income/(loss)12 14 
Changes in fair value recognized in interim condensed consolidated statement of operations2 — 
Return of capital(2)— 
Effect of changes in foreign exchange rates2 (1)
At June 3076 58 
Warrants
As of June 30, 2024 and December 31, 2023, the number of outstanding warrants was 800,000.
The outstanding warrants are valued using a Black-Scholes option-pricing model. Assumptions used to estimate the fair value of the warrants in the option pricing model are as follows:
 June 30, 2024
Expected term (years)0.15 
Risk free rate (%)5.47 %
Volatility (%)35 %
Share price (US$)313.79 
The table below presents the changes in the warrants liability:
 20242023
(in € millions)
At January 13 1 
Changes in fair value recognized in interim condensed consolidated statement of operations25 6 
Effect of changes in foreign exchange rates1 — 
At June 3029 7 
A 10% decrease or increase in the Company's ordinary share price would have resulted in a fair value of the warrants ranging from €13 million to €50 million at June 30, 2024.
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Exchangeable Notes
The table below presents the changes in the Exchangeable Notes:
20242023
(in € millions)
At January 11,203 1,128 
Changes in fair value recognized in interim condensed consolidated statement of operations78 48 
Changes in fair value recorded in other comprehensive income/(loss)5 14 
Effect of changes in foreign exchange rates37 (23)
At June 301,323 1,167 
The change in estimated fair value is recognized within finance income/(costs) - net in the interim condensed consolidated statement of operations, excluding changes in fair value due to changes in the Group’s own credit risk, which are recognized in other comprehensive income/(loss) and will not be reclassified to the interim condensed consolidated statement of operations.
The fair value of the Exchangeable Notes was estimated using a combination of a binomial option pricing model and prices observed for the Exchangeable Notes in an over-the-counter market on the last trading day of the reporting period. A weight of 75% was applied to the binomial option pricing model and a weight of 25% was applied to the price of the Exchangeable Notes in the over-the-counter market on the last trading day of the reporting period. The key assumptions used in the binomial option pricing model for the Exchangeable Notes were as follows:
June 30, 2024
Risk free rate (%)4.82 %
Discount rate (%)6.84 %
Volatility (%)40 %
Share price (US$)313.79
A decrease or increase of 10 percentage points in volatility would have resulted in a fair value of the Exchangeable Notes ranging from €1,295 million to €1,354 million at June 30, 2024. A 10% decrease or increase in the Company's ordinary share price would have resulted in a fair value of the Exchangeable Notes ranging from €1,305 million to €1,345 million at June 30, 2024. A decrease or increase of 100 basis points in credit spread would have resulted in a fair value of the Exchangeable Notes ranging from €1,336 million to €1,310 million at June 30, 2024.
20.Segment information
The Group has two reportable segments: Premium and Ad-Supported. Revenue for the Premium segment is generated primarily through subscription fees. Revenue for the Ad-Supported segment is primarily generated through the sale of advertising across the Group's music and podcast content. Royalty costs are primarily recorded in each segment based on specific rates for each segment agreed to with rights holders. All podcast content costs are recorded in the Ad-Supported segment. The costs of providing audiobook content as part of the Premium subscription are recorded in the Premium segment. The remaining costs that are not specifically associated to either of the segments are allocated based on user activity or the revenue recognized in each segment. No operating segments have been aggregated to form the reportable segments.
- 24 -
Key financial performance measures of the segments including revenue, cost of revenue, and gross profit are as follows:
  Three months ended June 30,Six months ended June 30,
 2024202320242023
 (in € millions)
Premium  
Revenue3,351 2,773 6,598 5,486 
Cost of revenue2,300 1,984 4,568 3,921 
Gross profit1,051 789 2,030 1,565 
Ad-Supported
Revenue456 404 845 733 
Cost of revenue395 427 759 766 
Gross profit/(loss)61 (23)86 (33)
Consolidated
Revenue3,807 3,177 7,443 6,219 
Cost of revenue2,695 2,411 5,327 4,687 
Gross profit1,112 766 2,116 1,532 
Reconciliation of segment gross profit
Operating expenses, finance income, and finance costs are not allocated to individual segments as these are managed on an overall Group basis. The reconciliation between reportable segment gross profit to the Group's income/(loss) before tax is as follows:
 Three months ended June 30,Six months ended June 30,
 2024202320242023
 (in € millions)
Segment gross profit1,112 766 2,116 1,532 
Research and development(379)(453)(768)(888)
Sales and marketing(343)(399)(667)(746)
General and administrative(124)(161)(247)(301)
Finance income76 33 135 60 
Finance costs(72)(27)(125)(104)
Income/(loss) before tax270 (241)444 (447)
Revenue by country 
  Three months ended June 30,Six months ended June 30,
 2024202320242023
 (in € millions)
United States1,469 1,251 2,862 2,439 
United Kingdom356 293 693 575 
Luxembourg2 2 5 4 
Other countries1,980 1,631 3,883 3,201 
Total3,807 3,177 7,443 6,219 
Premium revenue is attributed to a country based on where the membership originates. Ad-Supported revenue is attributed to a country based on where the advertising campaign is delivered. There are no countries that individually make up greater than 10% of total revenue included in “Other countries.”
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21.Commitments and contingencies
Commitments
The Group is subject to the following minimum guarantees relating to the content on its Service, the majority of which relate to minimum royalty payments associated with its license agreements for the use of licensed content:
 June 30, 2024December 31, 2023
 (in € millions)
Not later than one year590 1,055 
Later than one year but not more than five years2,196 3,610 
2,786 4,665 
In addition, the Group is subject to various non-cancelable purchase obligations and service agreements with minimum spend commitments, including a service agreement with Google for the use of Google Cloud Platform and certain podcast and marketing commitments:
June 30, 2024December 31, 2023
(in € millions)
Not later than one year292 453 
Later than one year but not more than five years1,463 1,369 
More than five years75 83 
1,830 1,905 
Contingencies
Various legal actions, proceedings, and claims are pending or may be instituted or asserted against the Group. These may include, but are not limited to, matters relating to intellectual property, data protection, consumer protection, employment, and contractual rights. As a general matter, the music and other content made available on the Group's Service are licensed to the Group by various third parties. Many of these licenses allow rights holders or other authorized parties to audit the Group's royalty payments, and any such audit could result in disputes over whether the Group has paid the proper royalties. If such a dispute were to occur, the Group could be required to pay additional royalties, and the amounts involved could be material. The Group expenses legal fees as incurred. The Group records a provision for contingent losses when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. An unfavorable outcome to any legal matter, if material, could have an adverse effect on the Group's operations or its financial position, liquidity, or results of operations.
On May 16, 2024, the Mechanical Licensing Collective (“MLC”), an entity designated to administer a blanket compulsory license available under U.S. law, filed a lawsuit against Spotify USA Inc. in the U.S. District Court for the Southern District of New York (Mechanical Licensing Collective v. Spotify USA Inc., No. 1:24-cv-03809), alleging that beginning with its March 2024 reporting, Spotify USA Inc. improperly reported and underpaid royalties for its Premium Service as a bundle that includes a specified monthly allocation of audiobook access. If the MLC were entirely successful in this case, the additional royalties that would be due in relation to the period March 1, 2024 to June 30, 2024 would be approximately €46 million, of which approximately €35 million relates to the three months ended June 30, 2024, plus potentially penalties and interest, which we cannot reasonably estimate. We intend to vigorously defend this lawsuit.
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Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
Special Note Regarding Forward-Looking Statements
This discussion and analysis reflects our historical results of operations and financial position and contains estimates and forward-looking statements. All statements other than statements of historical fact are forward-looking statements. The words “may,” “might,” “will,” “could,” “would,” “should,” “expect,” “plan,” “anticipate,” “intend,” “seek,” “believe,” “estimate,” “predict,” “potential,” “continue,” “contemplate,” “possible,” and similar words are intended to identify estimates and forward-looking statements.
Our estimates and forward-looking statements are mainly based on our current expectations and estimates of future events and trends, which affect