Spotify is pruning its global workforce by 17%, marking the music streaming service’s third wave of layoffs this year as it aims to reduce expenses and focus on profitability. CEO Daniel Ek announced the job cuts in a message to employees, calling it a “strategic reorientation.” The reduction amounts to about 1,500 employees.
Ek mentioned that Spotify had expanded the business and invested in employees, content, and marketing using low-cost financing in 2020 and 2021. However, the company faced challenges as central banks raised interest rates, impacting economic growth.
As a result, Ek emphasized the need to streamline the company’s structure to achieve continued profitability. Spotify reported a net loss of 462 million euros (about $500 million) for the nine months ending in September.
Earlier in the year, Spotify had implemented a 6% staff reduction in January and slashed another 2% of its workforce, primarily in the podcast division, in June.
Additionally, other tech giants such as Amazon, Google, Microsoft, Meta, and IBM have also announced significant job cuts in 2021.
