The world’s largest audio platform company Spotify on Monday announced staff cuts of “approximately 17%” to reduce costs amid a “dramatic” slowdown in economic growth.
The 17% corresponds to 1,500 employees who will be laid off.
“To align Spotify with our future goals and ensure we are sufficiently sized for the challenges ahead, I have made the difficult decision to reduce our overall workforce across the company by approximately 17%,” wrote CEO Daniel Ek in a letter to the group’s employees. , consulted by France Presse.
In October, the Swedish music platform announced that it recorded an operating profit again in the third quarter of this year, after several negative quarters, with a listing of 32 million euros.
“I am aware that a reduction of this magnitude may come as a surprise to many given the recent positive earnings report and our performance,” CEO Daniel Ek wrote in the same document.
According to Ek, in 2020 and 2021 the company “took advantage of the opportunities presented by cheaper capital and invested significantly in expanding the team, improving content, marketing and new verticals.”
“However, we now face a very different environment. Despite our efforts to reduce costs last year, our cost structure to achieve our objectives is still too high,” he added.
In 2017, the company had around three thousand employees, a number that had tripled to 9,800 by the end of 2022.
Since its inception, the platform has never posted a full-year net profit and only occasionally posted a quarterly profit, despite its success in the online music market.
Source: DN
