Spotify Reaches 300M Premium Subscribers, Expands AI Remix Tool to Independent Labels Through Merlin Partnership

Spotify has reached a historic milestone of 300 million paid Premium subscribers and 777 million total monthly users in Q2 2026. To capitalize on this scale and drive new revenue, Spotify announced a licensing agreement with Merlin, a digital rights body representing over 30,000 independent labels. The partnership expands Spotify's upcoming AI-powered fan remix and cover tool, which previously launched with Universal Music Group. Spotify is positioning the paid add-on tool as a legal, consent-based alternative to controversial generative AI platforms.

Spotify 300M Premium subscriber milestone

• ▪Spotify projected its third-quarter 2026 operating income at 670 million euros, falling slightly short of Wall Street consensus due to slowing user growth in established Western markets.
• ▪Spotify's Premium subscribers grew 9 percent year over year, while its total monthly active users rose 12 percent year over year in the second quarter of 2026.
• ▪Spotify reported a 14 percent year-over-year revenue increase to approximately 4.8 billion euros and a record gross margin of 33.4 percent in the second quarter of 2026.
• ▪Spotify reached 300 million paid Premium subscribers and 777 million total monthly active users in the second quarter of 2026.

Merlin licensing for remix tool

• ▪Spotify signed a licensing agreement with Merlin, a digital licensing body representing over 30,000 independent labels and distributors, to include its members in Spotify's upcoming fan-made covers and remixing tool.
• ▪Merlin represents independent music companies across more than 70 countries, accounting for approximately 15 percent of the global recorded music market.
• ▪The Merlin licensing agreement follows Spotify's previous agreements for the remixing tool with Universal Music Group in May 2026.

Artist consent in AI music

• ▪Spotify co-CEO Gustav Söderström stated that Spotify's AI music product focuses on real artists with real voices rather than creating fully artificial songs.
• ▪Spotify's upcoming AI music tool requires explicit consent from artists to add their work to the catalog, ensuring they are credited and compensated for fan-made covers and remixes.

Fan-made covers monetization strategy

• ▪Spotify plans to initially release a research preview of the fan remix and covers tool to a subset of users before its full commercial launch.
• ▪Spotify's fan-made covers and remixing tool will launch as a paid add-on, creating an additional revenue stream for participating artists and songwriters.

AI music competitive landscape

• ▪Google has expanded its presence in the AI music creation space through tools such as Google Flow Music.
• ▪Music streaming service Deezer reported that over 50 percent of its daily track uploads were generated with AI, up from 10 percent in January 2025.