Five months after saying it will lay off 6pc of its global workforce, Spotify is now cutting another 2pc as it makes a ‘strategic realignment’.
Spotify has announced that it will be laying off 200 employees in its podcast business as part of a wider restructuring to “optimise” the growing division.
Sahar Elhabashi, head of Spotify’s podcast business, confirmed that the “difficult but necessary decision” to make a “strategic realignment” of the podcast division will see the company bid adieu to approximately 2pc of its global workforce.
“We are expanding our partnership efforts with leading podcasters from across the globe with a tailored approach optimised for each show and creator. This fundamental pivot from a more uniform proposition will allow us to support the creator community better,” Elhabashi said.
“However, doing so requires adapting; over the past few months, our senior leadership team has worked closely with HR to determine the optimal organisation for this next chapter.”
This is the second round of layoffs Spotify has announced this year. In January, the Stockholm-based music streaming giant announced it was laying off around 6pc of its global workforce to rein in costs amid a challenging macroeconomic environment.
“As you are well aware, over the last few months we’ve made a considerable effort to rein in costs, but it simply hasn’t been enough,” CEO Daniel Ek told employees at the time. Last year, Spotify’s operational expenditure was double its revenue growth.
Spotify said it has more than 100m podcast listeners, and more than 500m people have listened to a podcast on its platform. It hosts more than 5m shows and ad revenue from the business has experienced “high double-digit growth” between 2021 and 2022.
“We know news like this is never easy, especially for those impacted. These decisions are not something we take lightly,” Elhabashi went on.
“The company will support these individuals with generous severance packages, including extended healthcare coverage and immediate access to outplacement support.”
Spotify, which recently tweaked its design to look more like Instagram and TikTok, said in its January earnings report that it had roughly 205m paid subscribers, a 14pc year-on-year increase. This growth also helped Spotify reach 489m monthly-active-users in the same period.
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