Spotify, the music streaming service, says it will reduce its employee base by 6% as mass layoffs continue to shake the tech industry.
In a cost-saving move now standard across the sector, Spotify will reduce its workforce by about 6% or some 600 people.
The Stockholm, Sweden-based company joins the likes of Google, Microsoft, and Amazon by responding to the global economic slowdown with staff reductions.
Spotify said it expected the move to increase efficiency and cut costs, noting that operating expenses outpaced revenue growth twofold in 2022.
“That would have been unsustainable long-term in any climate, but with a challenging macro environment, it would be even more difficult to close the gap,” Spotify CEO Daniel Ek said in a note to employees.
He said that one-on-one conversations would be held with all impacted employees and was careful to stress that changes would also affect the top management.
Chief Content Officer Dawn Ostroff will leave Spotify as part of the restructuring after joining the company in 2018. She oversaw the expansion of Spotify’s podcast content and is behind deals with Barack and Michelle Obama, as well as Prince Harry and Meghan Markle, among others.
The reorganization will see engineering and product work centralized under Chief Product Officer Gustav Soderstrom and business areas, including content, under Chief Business Officer Alex Norstrom. Both would help run the company “day-to-day” as co-presidents, Ek said.
“It’s my belief that because of these tough decisions, we will be better positioned for the future,” he said.
Last week, Google announced it would cut 12,000 roles, and Microsoft said its reductions would affect 10,000 jobs. Both cited overhiring during the pandemic, and a strategic refocus on AI, among other reasons.
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