In addition to the layoffs, the company’s CEO will also leave the company
Spotify announced this Monday (23) that dismissing 600 employees is equivalent to 6% of its staff. In addition, the audio streaming company also announced the departure of its vice president of content and advertising, Dawn Ostroff.
According to information published by Folha de S.Paulo, Spotify stated that it estimates expenses of 35 to 45 million euros related to the layoffs. In total, streaming had around 9,800 employees as of September 30th.
In a statement posted on the company’s investor website, Spotify CEO Daniel Ek said the layoffs are to “align the company’s costs”. In addition, the executive also stated that the decision had to be taken after seeing the company’s operating cost exceeded twice the increase in revenue.
“This would have been unsustainable in the long term in any climate, but with a challenging macro environment, it would be even harder to close the gap. As you are well aware, in recent months we have made considerable effort to contain costs, but it simply has not been enough” , said Ek, who also assumed responsibility for the company’s actions that led to the decision.
In October, the company announced that it was slowing its hiring for the remainder of 2022 and 2023. In 2022, the company’s shares accumulated a drop of more than 50%.
Then layoffs
Spotify is yet another company joining other big techs like Meta, Twitter and Amazon. In addition to these, two other bigtechs announced mass layoffs of their teams in the last week.
Last week’s wave began with the announcement of the resignation of 10,000 Microsoft employees. The terminations will take place until the end of the third quarter of fiscal year 2023, which occurs between April and June. According to G1, the cut represents about 5% of the total employee base of the company founded by Bill Gates.
Two days after Microsoft’s announcement, the market was surprised by the layoff by Alphabet (Google’s parent company), which announced the dismissal of 12,000 employees.
