Spotify Lays off 17 Percent of Staff, Citing Need to Cut Costs

Spotify CEO Daniel Ek has revealed the company is cutting roughly 17 percent of its staffing. Due to the cost-cutting initiative, the latest layoff rounds are said to impact around 1,500 of Spotify’s 9,241 employee count, as reported by The Wall Street Journal (via The Verge).

I have made the difficult decision to reduce our total headcount by approximately 17% across the company, “Ek said in a memo sent to staff. “I recognize this will impact a number of individuals who have made valuable contributions.” Ek continues to state that “Embracing this leaner structure will also allow us to invest our profits more strategically back into the business.”

Unfortunately, this isn’t the first round of layoffs Spotify employees have endured this year. In January, Spotify laid off roughly six percent of its staff, around 600 employees. Flashforward to June, when another estimated 200 jobs were cut from the company’s podcast arm.

Ek states that affected employees will sit down for a one-on-one conversation with their HR department to finalize severance and other key benefits. For instance, former employees will receive roughly five months of severance. Paiof time off will also be paid out. Healthcare will be supported during the severance window.

There is an underlying element in many of the recent layoffs within tech and gaming houses. Many brought in additional talent during the pandemic. Inflating its employee count when everyone was working remotely helped many companies reach new goals and expand over the last few years. Spotify, for instance, is reported to have doubled its staffing in the past three years. However, coming out of the pandemic, many have since failed to sustain their newfound and ambitious headcount.

“A reduction of this size will make it necessary to change the way we work, and we will share much more about what this will mean in the days and weeks ahead,” Ek concludes in the memo. “Just as 2023 marked a new chapter for us, so will 2024 as we build an even stronger Spotify.”

P.S. - Like our news? Support the site with a coffee/beer. Or shop with our Amazon link. We use affiliate links when possible--thank you for supporting independent media.