Spotify to cut 6% of jobs in latest wave of tech layoffs

What simply occurred? In a memo shared on Spotify’s web site, CEO Daniel Ek mentioned they’ve made the choice to cut back their worker base by about six p.c throughout the corporate. Ek mentioned Spotify has made nice strides in enhancing the velocity at which the corporate operates however added they have to additionally function with effectivity.

Spotify has turn out to be the most recent tech firm to announce organizational modifications leading to vital job cuts.

Like many others in the tech sector, Spotify grew and invested closely through the pandemic. Final yr, Spotify’s working bills outpaced income progress by 2x. As Ek famous, that’s unsustainable over the long-term in any local weather however particularly so through the present difficult macro atmosphere.

In hindsight, Ek mentioned he was too formidable in investing forward of income progress. “I take full accountability for the strikes that acquired us right here at the moment,” Ek mentioned.

All impacted workers will obtain severance pay, with the common worker receiving about 5 months of pay primarily based on issues metrics like tenure and native discover interval necessities. All accrued and unused trip time will even be paid out, and departing workers will proceed to obtain medical health insurance throughout their severance interval. What’s extra, all will probably be eligible for 2 months of outplacement providers to assist discover a new job whereas these whose immigration standing is linked to their employment will obtain assist from the HR and mobility groups.

A Spotify spokesperson instructed The Wall Avenue Journal the layoffs will impression about 600 employees, and are usually not focusing on a particular division.

Ek additionally introduced just a few management modifications. Most notably, Chief Content material and Promoting Officer Daybreak Ostroff has determined to go away the corporate. Below her management, Spotify grew its podcast content material by 40x and greater than doubled income generated from its promoting enterprise.

Regardless of the job cuts, Ek mentioned he’s assured that 2023 will probably be a yr crammed with a gentle stream of improvements in contrast to something they’ve launched within the final a number of years. Maybe Spotify HiFi will lastly make its long-awaited debut?

Picture credit score: Thibault Penin, Eyestetix Studio