Spotify Plans Layoffs, After Boss Concedes Miscalculation

Chief executive Daniel Ek told employees Monday that Spotify has been cutting costs for months. "It simply hasn't been enough," the staff memo said. So about 600 employees, 6% of the workforce, will lose their jobs, the New York Times reports. Government filings show the audio streaming platform had more than 9,800 employees at the end of the third quarter. Ek said he'd hoped that, with Spotify being less vulnerable to a drop in ads than other businesses and having a "broad global business," the company would be safe from the effects of the pandemic slowdown. "In hindsight, I was too ambitious in investing ahead of our revenue growth," he wrote.

Spotify shares rose more than 3% Monday after news of the layoffs, per CNBC. Other tech companies have announced layoffs recently, including Google's parent, which also is cutting about 6% of its global workforce, amounting to 12,000 jobs. Spotify said its employees will receive about five months of severance pay and health care. Most of its employees are in the US, the rest in Sweden, where the company is based. (More Spotify stories.)