Published
Mon, Dec 4, 2023, 14:25
- In a statement, the streaming platform's CEO, Daniel Ek, said "economic growth has slowed dramatically."
Spotify is cutting more than 1,500 jobs because of rising costs.
According to a statement written by the company's billionaire founder, Daniel Ek, the company is reducing the workforce by 17 percent because "economic growth has slowed dramatically and capital has become more expensive." Spotify currently employs more than 9,000 people worldwide.
The company, Ek added, currently finds itself in a "very different environment." In 2020 and 2021, it took advantage of slashed interest rates caused by the pandemic. But despite "recent positive earnings"—€37 million last quarter, according to the website–job cuts were necessary to help remedy the gap between Spotify's financial goals and current operating costs.
Ek said the average Spotify employee will be given five months of severance pay. The company is also providing "immigration support" to employees "whose immigration status is connected with their employment," he added.
These are the latest round of layoffs at Spotify—in January, the company let go of six percent of its staff. In July, the company increased the price of Spotify Premium and reported a three percent rise in subscribers on a quarterly basis. Subscribers also recently rose 16 percent year-on-year to 226 million.
Read Ek's statement in full.
Photo: Sara Kurfess