Online streaming platform Spotify said it will reduce its workforce by about 17% across company with an aim to reduce its costs and alter reasons for slowdown in growth. Daniel Ek, executive chief, on Monday, shared a note on the company’s official website.
The audio company said resizing of the firm’s workforce is remarkably large in comparison to the recent earning report which was comparatively positive.
The mass layoff initiated by the company will be affecting nearly 1500 job positions. In 2022, the company had 8,359 full-time employees based on its annual report and about 20% of its employees are based in Sweden.
The global audio streaming service said with more resources, it was more productive. However, the efficiency has been depleting, said the company, and in order to balance them both, the firm has decided to restructure its operations through the layoff.
The impacted employee will receive calendar invite from the human resources (HR) for a one-on-one conversation, said Spotify, as well as the meeting will take place by the end of Tuesday. The firm also said the employees will be compensated with five months of severance pay calculated according to notice period regulations and individual tenure.
The management debated making smaller reductions throughout 2024 and 2025, said Ek and added, considering the gap between Spotify’s financial goal state and its current operational costs, he decided that a substantial action to right-size the company’s costs was the best option to accomplish its objectives.
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