Spotify is leaning further into AI as it holds to its promise of reaching 1 billion active users by 2030. 

At the company’s investor day in New York Thursday, executives laid out the planned pathway for hitting that number, as well as $100 billion in annual revenue, with new features including the ability to create AI-generated personalized podcasts, user-generated covers and remixes using AI and more. Spotify also plans to continue creating more paid add-on services or subscriptions, alongside its audiobooks offering, which they say has been one of its most-engaged segments on the platform. 

As co-CEO Gustav Söderström laid out, in the beginning, the company’s motto was access. Spotify then moved into personalization, with curated playlists and more. Next up is “generation,” drawing on AI tools to help create content on the platform. 

“We’re entering the era of generation, where the experience isn’t just selected from a catalog. It’s shaped by each of our users, in real time, around their taste, context, and intent. Today, there is no media player for both public and private content – or put differently – there is no media player for the generative era. We believe Spotify will become that,” said Gustav Söderström, co-CEO of Spotify. 

The personalized podcasts and user-generated covers and remixes join existing personalization products on Spotify including AI DJ, which creates curated playlists for the user, and Prompted Playlists. Spotify also unveiled a desktop app which can create a audio daily briefing or a podcast based on the user’s emails and schedule. 

The idea in leaning into AI and offering more personalized products is to help improve retention, conversion to paid membership and time spent on the platform, as Spotify gains a deeper understanding of the individual. AI can also be used to add in more content in the language of each market, and make it localised faster. 

As it stands, the company last reported 761 million global monthly active users, with 293 million of those as subscribers. Annual revenue was about $18.5 billion in 2025.  Spotify highlighted potential future user growth in Brazil, India and The Philippines among other markets.

Amid the AI talk, the company also announced that its Audiobooks segment is on track to reach $100 million in annualized recurring revenue from Audiobooks+ subscriptions this July. Paid users already have access to 15 free hours of audiobook content, with the add-on Audiobooks+ subscription giving them an additional 15 hours. In less than a year, more than one million users are already paying for audiobooks, according to Spotify. 

It has also seen some of the deepest continued engagement on Spotify, which is a metric the company is leaning into moving forward.

“The number of times that you come back to us in a month, and the number of devices you use might be among the most important metrics that we monitor,” Nördstrom said. 

On Thursday, the company also announced the creation of more add-on tiers for its audiobook offering, which offer more hours for a higher price. This comes as part of a plan to increase the amount of revenue generated by users that already subscribe. The company recently introduced fitness, via partnership with Peloton to stream videos on the platform. which executives said they believe has the “potential to become a meaningful vertical in its own right.” Executives also said they are eyeing several more future verticals. 

Podcasting has also “made significant progress,” according to CFO Christian Luiga, who described the segment’s gross margin as “deeply negative” in 2021 and growing to 20 percent in 2026. He added that the company sees “a path to 40 percent” gross margin, which will be driven by both first and third-party content. 

With the additional add-ons and new features, there will be further price increases down the line, but executives noted that there has been little churn with the prior increases.

“You can expect us to continue on this journey. But we always want the user to win,” Nördstrom said of price increases. 

For the second and third quarter, the company said it will increase its spending in marketing and research and development as it adjusts to these new realities and may allocate capital to M&A, according to Luiga, while maintaining a “build-first strategy.” 

But overall Spotify, which has previously gone through a number of cost-cutting measures, said it would be relying on greater efficiency through AI. “We’re no longer scaling by increasing headcount, we’re scaling by increasing the impact of the people that we already have,” one executive said.