Spotify CEO, Daniel Ek, dropped a bombshell: the company’s chopping about 1,500 jobs. They’re doing this to save money after a tough year. Ek’s talking about a “significant” change in how they run things at the music-streaming company.
Why the Cuts?
Ek’s saying the world economy isn’t doing great, and getting money for projects is harder now. Spotify wants to get back to their startup vibe after going on a huge hiring spree. They got tons of subscribers, but they’re still not making steady profits.
The Decision
Ek thought about doing smaller cuts next year and in 2025, but he figured it wasn’t enough to fix how much they’re spending. So, he’s going big with these job cuts to balance the money stuff.
He’s keeping it real, saying lots of smart and hard-working folks will be leaving the company.
What Happens Next
They’re gonna have meetings with the people getting the boot before Tuesday ends. And these folks will get around five months’ worth of pay after leaving.
Spotify’s History of Cuts
This isn’t the first time Spotify’s had to slim down. Earlier this year, they cut over 500 jobs, and back in June, 200 folks got axed from their podcast team.
Tech Company Troubles
Other big tech companies like Microsoft and Amazon have also been cutting jobs. During the pandemic, everyone was hiring like crazy to keep up with all the online shopping and video calls. But now, with things getting pricier and the economy slowing down, they’re cutting back.
Spotify’s Story
Spotify’s been doing alright with more people signing up, but they’re spending too much. They’re not as slick and sharp as they were when they started out as a small tech company. According to Ek, there are too many people doing support work instead of focusing on making stuff for creators and users.
Still a Way to Go
Even with 6 million more subscribers than they expected, Spotify only made a small profit. Last year, they were in the red by a lot. Right now, they’ve got around 226 million subscribers, but they’re still not totally efficient and productive.
What’s the Plan?
Ek’s saying this isn’t a step backward; it’s a fresh start. This big cut means they have to switch things up in how they work. They’re gonna spill more details about this soon.
In a nutshell, Spotify’s shaking things up with big job cuts to get back on track financially. It’s a tough move, but they’re aiming to get back to their efficient, startup roots.