Music streaming powerhouse Spotify has declared that it will lay off 1,500 employees, which accounts for about 17% of its workforce.
This decision was explained by founder and CEO Daniel Elk, who mentioned that the economic conditions of 2020-21 led to a hiring spree at Spotify. However, the company’s performance did not meet expectations to justify those additional hires.
In a blog post, Elk acknowledged the impact of the layoffs on valuable and hard-working individuals, stating, “To be blunt, many smart, talented, and hard-working people will be departing us.”
Affected employees were informed about the layoffs on Monday. These recent job cuts are part of a series of layoffs that have occurred throughout the year. Spotify had previously cut around 200 jobs in January and an additional 600 in June. Following the latest layoffs, Spotify’s workforce will stand at approximately 7,300 employees.
Despite exceeding user growth expectations in the last quarter and the anticipation of surpassing fourth-quarter expectations for this year, the layoffs were deemed inevitable by Elk.
He expressed, “I realize that for many, a reduction of this size will feel surprisingly large, given the recent positive earnings report and out-performance. We debated making smaller reductions throughout 2024 and 2025.”
The challenging economic climate has prompted various tech companies, including Meta, Amazon, and Google, to downsize their workforce and reevaluate their future projects.
The decision by Spotify to reduce its workforce underscores the difficulties faced by tech companies worldwide as they adapt to the changing economic environment and strive to maintain stability amid market uncertainties.
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