Spotify layoffs: Music streamer to lay off 17% of workforce

Spotify has laid off 17% of its employees, or more than 1,000 people, chief executive Daniel Ek said in a note about organisational changes at the music-streaming company on Monday. This is the company’s second round of layoffs this year, after sacking 6% of its workforce in January, citing a challenging economic environment. In October 2022, it laid off 38 staffers from its Gimlet Media and Parcast podcast studios.

“To align Spotify with our future goals and ensure we are right-sized for the challenges ahead, I have made the difficult decision to reduce our total headcount by approximately 17% across the company. I recognize this will impact a number of individuals who have made valuable contributions,” Ek said in the note.

The CEO said that for many, a reduction of this size would feel surprisingly large given the company’s recent positive earnings report.

“We debated making smaller reductions throughout 2024 and 2025. Yet, considering the gap between our financial goal state and our current operational costs, I decided that a substantial action to rightsize our costs was the best option to accomplish our objectives,” Ek added.

In the third quarter, the company swung to a profit aided by price hikes in its streaming services and growth in subscribers in all regions, and forecast that its number of monthly listeners would reach 601 million in the holiday quarter.

Affected employees will be informed “over the next several hours” and will receive an average of five months of severance pay, during which time the company will continue to cover their healthcare costs, Spotify said.

They will also be covered under healthcare benefits during their severance period. All accrued and unused vacation will be paid out to any departing employee, the company added.

It will also assist employees whose immigration status is connected with their employment.