Photo: @felipepelaquim / Unsplash
Spotify will cut 1,500 jobs, its third round of layoffs this year, CEO Daniel Ek said Monday. He said the music-streaming company needs to slash costs and boost efficiency in a tough economy. The layoffs are part of a big strategy shift that will take Spotify back to its startup roots after a spending spree increased its subscribers but not its profits.
Affected staff will get about five months of severance pay. Spotify, which has more than 9,000 employees, followed other tech giants in reducing headcount as the global economy slowed.
Spotify added 6 million subscribers in the third quarter, beating its forecast. But it only made a profit of €32 million (CA$46.9 million), compared to a loss of €228 million (CA$334 million) a year ago. It has 226 million subscribers in total.
Ek said Spotify has become less efficient and lost its resourcefulness. He said the company will change how it works and share more details soon.