Over 1,500 Jobs Axed In Spotify Layoff

Spotify is axing 1,500 jobs from its arsenal, laying off 17% of its workforce in an end-of-year organisational change, Music Business Worldwide reports.

Earlier this year, Spotify reported having 9,241 employees globally; this new round of job cuts is the third the music streaming giant has made this year. The job cuts began in January, with over 500 jobs gone – making up “about 6% across the company”, with another layoff occurring in June. 2% of the company’s workforce lost their jobs, with 200 people in the podcast division involved in those cuts.

The latest job cuts arrived a month after Spotify revealed in its Q3 report that the streaming service now has 226 million paying users for its Premium Subscription base. That number was an impressive 16% increase Year on Year, signalling a growth of six million paying customers from the previous quarter.

In a memo sent out to Spotify staff, which is now on the Spotify website, the company’s co-founder and CEO Daniel Ek said that the decision to cull 1,500 jobs is due to “economic growth” that’s “slowed dramatically” and that “capital has become more expensive.”

Ek added, “Despite our efforts to reduce costs this past year, our cost structure for where we need to be is still too big.”

He continued, “This brings me to a decision that will mean a significant step change for our company. To align Spotify with our future goals and ensure we are right-sized for the challenges ahead, I have made the difficult decision to reduce our total headcount by approximately 17% across the company.

“I recognise this will impact a number of individuals who have made valuable contributions. To be blunt, many smart, talented and hard-working people will be departing us.”

Towards the end of the memo, Ek assured the staff members who would be laid off that they’d receive their severance pay, all accrued and unused annual leave days, healthcare coverage during the severance pay period, immigration support for the workers whose jobs are connected to their immigration status, and career support throughout Spotify, meaning that for two months, employees will be eligible for outplacement services.

The Music has reached out to Spotify AUNZ for comment about the impact of the job cuts on Australian employees.