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Music streaming service Spotify said on Monday it was cutting six percent of its global workforce, becoming another tech company to use layoffs as its post-pandemic economic outlook weakens.
CEO Daniel Ek announced the restructuring in a message to employees that was also posted online.
As part of the revamp involving management reshuffle, “and to bring our costs more in line, we have made a difficult but necessary decision to reduce the number of our employees,” Ek wrote.
Big tech companies like Amazon, Microsoft and Google announced tens of thousands of job cuts this month as the economic boom the industry experienced during the COVID-19 pandemic subsides.
Ek said Stockholm-based Spotify is no different. The company’s operating costs last year have doubled revenue growth, a gap that will be “unsustainable long-term” in any economic climate, but it is even more difficult to close with the “challenging macro environment,” he said.
Spotify is benefiting from the pandemic lockdown as more people seek entertainment while staying at home.
“I hope to support the strong tailwinds of the pandemic and believe that the broad global business and the lower risk of the impact of the slowdown in advertising will isolate us. In hindsight, I am very ambitious to invest before our revenue growth, “Ek said.
He said the company is reducing its global workforce by about six percent, without giving any indication of job losses. Spotify is just shy of 10,000 workers worldwide, which means that 600 jobs have been cut.
“I take full responsibility for the movement that brought us here,” Ek said.
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