Spotify has announced it is reducing its workforce by a whopping 17% in a round of cost-cutting measures.
“I recognize this will impact a number of individuals who have made valuable contributions. To be blunt, many smart, talented and hard-working people will be departing us,” CEO Daniel Ek wrote in a letter published to the company’s website.
Ek admitted the company considered making smaller job cuts in 2024 and 2025, but decided it was more feasible to make wide-ranging job eliminations now.
“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,” he wrote. “While I am convinced this is the right action for our company, I also understand it will be incredibly painful for our team.”
The cuts from Spotify come after a 6% reduction in force earlier this year eliminated the jobs of 600 within the digital audio company.
Ek argued the decision to eliminate so many jobs was a strategic one for the company, with an eye toward different goals.
“The decision to reduce our team size is a hard but crucial step towards forging a stronger, more efficient Spotify for the future. But it also highlights that we need to change how we work. In Spotify’s early days, our success was hard won. We had limited resources and had to make the most of every asset,” he concluded. “Our ingenuity and creativity were what set us apart. As we’ve grown, we’ve moved too far away from this core principle of resourcefulness.
The Spotify of tomorrow must be defined by being relentlessly resourceful in the ways we operate, innovate, and tackle problems. This kind of resourcefulness transcends the basic definition – it’s about preparing for our next phase, where being lean is not just an option but a necessity.”
