In an attempt to cut costs, Spotify plans to slash 17% of its workforce, affecting approximately 1,500 employees.
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According to an official statement from CEO Daniel Ek, this decision was made due to slow economic growth and rising costs, aiming to make Spotify more efficient. This marks the third time this year that the streaming service has faced mass layoffs, with the first occurrences in January and June.
According to The Verge, Spotify‘s focus on growth, resulting in a significant increase in employees during the pandemic, is being reevaluated due to investor pressure for profitability. CEO Ek mentioned the intention to make Spotify profitable by 2024; however, the latest earnings report revealed losses of €462 million in the first nine months of this year.
Employees affected by the cuts will receive approximately five months of severance pay, with the company covering their healthcare during this period.
