Spotify CEO says layoffs brought 'more' disruption than expected but were 'right strategic decision'

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Spotify Chief Executive Daniel Ek described the job cuts on Spotify’s earnings call as a 'significant challenge' that the Sweden-based company contended with.

Spotify CEO Daniel Ek on Tuesday acknowledged that layoffs the audio streaming giant implemented in December affected production in the company's first quarter. Ek described the job cuts on Spotify’s earnings call as a "significant challenge" that the Sweden-based company contended with. "Although there’s no question that it was the right strategic decision, it did disrupt our day-to-day operations more than we anticipated," he said.

Spotify previously issued guidance that it expected to have 618 million total monthly active users in the first quarter. The figure totaled 615 million MAUs. Overall, Spotify had a "solid quarter driven by strong revenue growth, expanding gross margin and the largest operating income we’ve ever posted," Ek said. On top of the layoffs, Ek pointed to 2023’s MAU growth as a factor that contributed to the company not hitting its MAU growth goal in the first quarter.

 

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