Spotify has decided to lay off 1,500 workers.
Spotify layoffs: This is the third round of job cuts at the company and around 1,500 workers are expected to be laid off.
Music streaming major Spotify is cutting about 17 percent of its jobs across the company to cut costs amid the economic downturn and expensive capital, its CEO Daniel Eke said in a blog post. This is the third round of job cuts at the company and around 1,500 workers are expected to be laid off.
The announcement comes after Spotify recently posted its first profitable quarter in two years with an operating profit of 32 million euros.
“To align Spotify with our future goals and ensure we are right-sized for the challenges ahead, I have made the difficult decision to reduce our total headcount across the company by approximately 17 percent,” CEO Daniel Eke said in the blog.
He said he recognized it would affect many people who had made valuable contributions. “To be stupid, a lot of smart, talented and hard-working people will leave us.”
Economic growth has slowed dramatically and capital has become more expensive. Spotify is no exception to this reality, says the Spotify CEO.
“I understand that for many, a reduction of this size will seem surprisingly large given the recent positive earnings report and our performance. We debated making smaller reductions throughout 2024 and 2025. Nevertheless, considering the gap between our financial goal state and our current operating expenses, I have decided that a significant step to own our expenses to meet our objectives is the best option. While I am confident that this is the right move for our company, I also understand that it will be incredibly painful for our team,” he said.
He said that as part of the process, affected employees will receive a calendar invitation from HR for a one-on-one conversation. These meetings will be held before the end of the day on Tuesday. He said the following would apply to all these bandmates:
Severance pay: We’ll start with a baseline for all employees, where the average employee will receive about five months of severance. This will be calculated based on local notice period requirements and the employee’s tenure.
PTO: All accrued and unused vacation will be paid to any departing employee.
Healthcare: We will continue to cover health care for employees during their separation period.
Immigration Assistance: For employees whose immigration status is linked to their employment, HRBPs are working with each affected individual in conjunction with our mobility team.
Carrier Support: All employees will be eligible for outplacement service for two months.
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