Spotify Technology said on Monday, January 23, that it plans to cut 6% of its payroll and that it would take a related position of up to almost US$50 million, which would add to the massive layoffs in the technology sector in the face of a possible recession. The technology sector faces a decline in demand after two years of growth driven by the pandemic, during which he had aggressively recruited. This has led companies like Meta or Microsoft Corp to eliminate thousands of jobs.
“Over the past few months, we’ve made a considerable effort to contain costs, but it hasn’t been enough,” Chief Executive Daniel Elk said in a blog post announcing the cuts of some 600 jobs.
“I have been too ambitious by investing above our revenue growth,” he added, echoing a view expressed by other tech executives in recent months.
The operating expenses of Spotify They grew twice as fast as revenue last year as the online audio streaming company invested aggressively in its podcast business, which is more attractive to advertisers due to its higher levels of engagement.
At the same time, companies reduced ad spend on the platform, mirroring a trend seen in Goal and in Alphabet, matrix of Googleas rapidly rising interest rates and the aftermath of the Russia-Ukraine war put pressure on the economy.
The company, whose shares rose more than 3% in operations prior to the opening of the session, it is being restructured to reduce costs and adapt to the deteriorating economic situation.
Head of content will leave his position
Dawn Ostroff, head of content and advertising, will leave the company after more than four years with it. Ostroff helped shape Spotify’s podcast business and guided it through the backlash surrounding the Joe Rogan show for allegedly spreading misinformation about COVID-19.
The company has announced the appointment of Alex Norström, head of the freemium business, and Gustav Söderström, head of research and development, as co-chairmen.
As of September 30, 2022, Spotify it had about 9,800 full-time employees.
With information from Reuters.
Source: Larepublica
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