Spotify layoffs: Music streaming business to cut 6% of workforce

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Over the past few months, major tech companies have swiftly reversed a pandemic hiring spree that saw them add thousands of workers to keep up with a surge in demand from households and businesses for services such as online shopping and videoconferencing.

The same companies have recently made deep cuts to their workforces, as inflation weighs on consumer spending and rising interest rates squeeze funding. The demand for digital services during the pandemic has also waned as people return to their offline lives.

Over the past three months, Amazon, Google, Microsoft and Facebook-parent Meta have announced plans to cut more than 50,000 employees from their collective ranks,The recent cuts in most cases amount to a relatively small percentage of each company's overall headcount, essentially erasing the last year of gains for some while leaving them with enormous workforces.

Spotify's decision to shed about 590 jobs is part of a wider reorganization to improve efficiency and "speed up decision-making," according to Ek. As part of the changes, engineering and product work will be centralized. Chief content officer Dawn Ostroff had also decided to leave the company, Ek said.

Spotify reported a loss of 228 million in its most recent financial quarter through Sept. 30, as operating expenses shot up by 65%, according to a company presentation to investors."That would have been unsustainable long-term in any climate, but with a challenging macro environment, it would be even more difficult to close the gap," he told employees in Monday's letter.

 

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