Spotify to cut 6% of workforce in latest tech layoffs

Spotify Technology SA lays off 6% of its workforce as part of broader cost-cutting measures after the streaming giant He went to spend During the pandemic.

The company’s move is recent A wave of technical layoffsThe industry is restructuring after rapid growth in the past few years and ahead of a possible recession.

“Over the past few months we’ve made a significant effort to control costs, but it hasn’t been enough,” Spotify chief executive Daniel Eck said. A letter to employees on Monday. “So, while it’s clear that this path is the right one for Spotify, it doesn’t make it any easier.”

The Stockholm-based company has about 8,600 employees worldwide, according to its website. Spotify says Mr. Ek had said last year Slows down hiring But there are no plans to lay off anyone.

“In retrospect, I was very ambitious in investing ahead of our revenue growth,” he said Monday, “and I take full responsibility for the moves that got us here today.”

Spotify did not immediately return a request for comment on Monday.

Tech companies big and small have struggled with economic turmoil after swelling their headcount over the past few years. Now, many Some of their latest additions make the cut and abandoning long-term plans.

Spotify joins

Amazon.com Inc.,

Google Parents

letters Inc.

And

Microsoft Corp

And others have cut staff in recent weeks.

Last year Spotify’s operating expenses doubled its revenue, Mr. Ake said. He said the layoffs were a difficult but necessary decision.

“Like many leaders, I believe we will sustain strong tailwinds from the pandemic, and believe our broad global business and low exposure to the impact of an advertising recession will protect us.”

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Spotify is one of the most popular music streaming services in the world. The company announced in October that it had about 456 million monthly active users.

Mr. Ake said. He also announced some C-suite changes, including Spotify’s Chief Content Officer Dawn Ostroff leaving the company.

Recent headlines about tech layoffs don’t match broader economic indicators, which show a strong job market and a historically low unemployment rate. WSJ’s Gunjan Banerjee explains the disconnect. Description: Ali Larkin

Ms. Ostroff helped establish the company A major player in the podcast spaceSigning deals with high profile celebrities like Michelle Obama, Kim Kardashian and Joe Rogan.

In 2020, he helped the podcast industry hit one Huge licensing dealsMr. Rogan’s podcast brings in more than $100 million exclusively for Spotify.

Company last year It outlined plans for its development Even if investors worry that the audio market prospects are limited. Mr. Ek then said.

Spotify said that last year Expect to raise prices In 2023. The premium service in the US costs $9.99 a month since Spotify launched in the US in 2011.

News Corp’s Dow Jones & Co., publisher of The Wall Street Journal, has a content partnership with Spotify’s Gimlet media unit.

Write to Alyssa Lukpat at [email protected]

Write to Alyssa Lukpat at [email protected]

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