STOCKHOLM (ANP) – Music streaming service Spotify will once again cut hundreds of jobs to reduce costs. The company is saying goodbye to approximately 17% of its workforce.
It is not clear exactly how many jobs will be lost. At the beginning of this year, Spotify already announced a 6% reduction in jobs. That would have amounted to almost 600 of the approximately 9,800 jobs. It was then announced in June that an additional 200 jobs would have to be cut.
Despite these previous attempts to reduce costs, the company is still spending too much, according to CEO Daniel Ek. “We still have too many people,” he said in a statement on the website.
More listeners
In October, Spotify reported that it was gaining more and more listeners. Spotify also managed to finally return to the black figures with its operating result in the summer quarter. This was partly due to higher rates. In July, the Swedish company had increased the prices of its premium subscriptions in several countries.
But according to Ek, Spotify is still under pressure due to slower economic growth and interest rate increases that have made it more expensive to borrow. “The decision to reduce our team size is a tough but crucial step toward forging a stronger, more efficient Spotify for the future,” he argues.
Affected employees
Spotify, like other technology companies, has grown significantly during the corona pandemic. The workforce has almost doubled in size in recent years. As investors have focused more on profitability and less on growth, many streaming-focused companies have already cut costs.
Spotify also has a branch in Amsterdam, but it is not known to what extent that location will be affected by this intervention. Employees whose jobs are disappearing will hear this soon, Ek says. “If you are an affected employee, you will receive a calendar invitation from HR for a one-on-one meeting within the next two hours.”
