Spotify says it’s axing 17 per cent of its global workforce, the music streaming service’s third round of layoffs this year as it moves to slash costs while focusing on becoming profitable.
In a message to employees posted on the company’s blog on Monday, CEO Daniel Ek said the jobs were being cut as part of a “strategic reorientation”. The post didn’t specify how many employees would lose their jobs, but a spokesperson confirmed that it amounts to about 1500 people.
Spotify had used cheap financing to expand the business and “invested significantly” in employees, content and marketing in 2020 and 2021, the blog post said.
But Ek indicated that the company was caught out as central banks started hiking interest rates last year, which can slow economic growth. Both are posing a challenge, he said.
“We now find ourselves in a very different environment. And despite our efforts to reduce costs this past year, our cost structure for where we need to be is still too big,” he said.
