Spotify pays artists in two ways: recording royalties and publishing royalties. Recording royalties are the money owed to rightsholders for recordings streamed on Spotify, which is paid to artists through the licensor that delivered the music, typically their record label or distributor. Publishing royalties are the money owed to songwriter(s) or owner(s) of a composition, and these payments are issued to publishers, collecting societies, and mechanical agencies based on the territory of usage.

Contrary to what some people might think, Spotify does not pay artist royalties according to a per-play or per-stream rate. Instead, the royalty payments that artists receive might vary according to differences in how their music is streamed or the agreements they have with labels or distributors. However, according to a report by Ditto Music, Spotify pays artists between $0.003 - $0.005 per stream on average, which works out as an approx revenue split of 70/30 - so that’s 70% to the artist/rights holders and 30% to Spotify.

It is important to note that Spotify has no knowledge of the agreements that artists and songwriters sign with their labels, publishers, or collecting societies, so they cannot answer why a rightsholder’s payment comes to a particular amount in a particular month.

In summary, Spotify pays artists through recording and publishing royalties, and the amount an artist receives per stream might vary depending on their agreements with labels or distributors. However, on average, Spotify pays artists between $0.003 - $0.005 per stream, with a revenue split of 70/30 in favor of the artist/rights holders.