Monthly active users at Spotify rose 11 percent year-over-year to reach 640 million in the third quarter, while total paid subscribers increased 12 percent to 252 million, with both beating the companys guidance by 1 million.

Total revenue was up 19 percent to reach 4 billion, in line with the companys expectations. Operating income improved to 454 million, thanks to gross margin strength and lower personnel related and marketing costs, which is a record high for the company, and puts Spotify on the track to reach its first full year of operating income profitability. The operating income tally was impacted by 54 million in social charge accruals, or payroll taxes associated with employee salaries and benefits, which were 39 million above forecast due to share price appreciation during the quarter.

The revenue numbers were primarily driven by a 21 percent increase in premium or paid revenue growth, driven by subscriber gains and ARPU increases (prices for premium accounts were increased starting in June). Ad-supported accounts saw revenue growth of 6 percent year-over-year, with Spotify noting a challenging brand environment and softness in pricing in music and podcasting advertising.

At the end of Q3, the Spotify workforce consisted of 7,242 full-time employees globally.

Weve never been in a stronger position, thanks to the outstanding execution by our team. Im incredibly proud of the way weve delivered and the progress weve made, said Daniel Ek, Spotify Founder CEO. Were where we set out to beif not a little furtherand on a steady path toward achieving our long-term goals. This relentless pursuit of innovation and commitment to growth sets us up to deliver the most valuable user experience in the industry, while reinforcing the core strengths that make Spotify unique. I am very excited about what lies ahead for us.

More to come.