Music - Music streaming service Spotify cuts around 1500 jobs
The music streaming service Spotify wants to cut around 1500 jobs. Around 17 percent of employees will have to leave Spotify, wrote company boss Daniel Ek in a letter published on the Spotify website on Monday. He cited the slowdown in economic growth and the rise in interest rates as reasons. This is also affecting Spotify. At the end of 2022, the Stockholm-based company had almost 8,400 employees. Around 1,500 jobs will be affected by the cutbacks, a spokesperson said.
Ek added that he was aware that a cut of this magnitude would come as a surprise to many in view of the recent positive earnings report. Spotify made it into the black in the third quarter after an increase in user numbers and a price increase. The Swedish company is considered the clear number one in music streaming, ahead of Apple and Amazon.
According to Ek, a smaller reduction in staff over the next two years has also been discussed. "However, given the gap between our financial targets and our current operating costs, I have decided that a comprehensive measure to adjust our costs is the best option to achieve our goals," the manager wrote.
Employees affected by the job cuts are to receive severance pay and any remaining vacation days will be paid out.
Read also:
Daniel Ek, the CEO of Spotify, acknowledged that the 1500 job cuts might be unexpected given the company's recent positive earnings report, which included an increase in user numbers and a price hike. Ek is based in Stockholm, Sweden, where Spotify, the global leader in music streaming, is headquartered, surpassing competitors like Apple and Amazon. Despite discussions of smaller reductions over the next two years, Ek believed a comprehensive cost adjustment was necessary due to financial targets and current operating expenses.
Source: www.stern.de
