Spotify cuts 600 jobs: Read CEO Daniel Ek’s memo
In the memo, Daniel Ek explained that “he was too ambitious” to invest before the company showed revenue growth.
Ek’s memo reads: “We are reducing our employee base by about 6 per cent across the company. I take full accountability for the moves that got us here. Like many other leaders, I hoped to sustain the strong tailwinds from the pandemic and believed that our broad global business and lower risk of the impact of a slowdown in ads would insulate us. All accrued and unused vacation will be paid out to any departing employee. We will continue to cover healthcare for employees during their severance period.”
Spotify offers benefits for laid-off employees
The company also mentioned that an average employee will even receive nearly 5 months of severance. The severance will be calculated based on local notice period requirements and employee tenure. Moreover, the company also added that all employees will be eligible for outplacement services for 2 months.
Spotify’s podcast investment
In 2019, Spotify invested over a billion dollars in podcasts to create software, acquire podcast networks and serve as a hosting service. After facing pressure from investors, Spotify reportedly shut down 11 original podcasts from its in-house studios in October 2022. This move was a part of the company’s cost-cutting and layoffs which took place recently. Apart from this, Spotify also laid off or reassigned less than 5% of the company’s staff from original podcasts to new shows.