Music streaming service Spotify said on Monday that it will cut six percent of its workforce, or about 600 jobs, joining a growing list of technology companies in announcing job cuts to lower costs.
“Over the last few months we’ve made a considerable effort to rein in costs, but it simply hasn’t been enough,” Ek said.
“Like many other leaders, I hoped to sustain the strong tailwinds from the pandemic and believed that our broad global business and lower risk to the impact of a slowdown in ads would insulate us. In hindsight, I was too ambitious in investing ahead of our revenue growth,” he added.
The Swedish company had 9,808 employees globally at the end of the third quarter, according to an earnings report.
“While we have made great progress in improving speed in the last few years, we haven’t focused as much on improving efficiency,” Ek said. “And in a challenging economic environment, efficiency takes on greater importance.”The company is offering laid-off employees an average of five months of severance pay and health care coverage, Ek said.
Spotify is expected to incur at least 35 million euros in severance-related charges.