Spotify CFO Paul Vogel On The “Real Positive” Of The Company’s Recent Layoffs, Its Current Podcast View, Rivalry With Apple And Outlook For A “Choppy” Economy

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Spotify CFO Paul Vogel said the company’s decision several weeks ago to cut 6% of its global workforce was a “a real positive” in terms of the company being willing to take a hard look at its operations and “evolve”

announced in January followed a 26% year-over-year increase in employees in 2022 compared with 2021, including the hiring of some 1,000 engineers.

Before the Q&A period with Morgan Stanley analyst Benjamin Swinburne, Vogel kicked off the session by recapping highlights from the company’s annual Stream On event, which was held earlier Wednesday. Among the noteworthy revelations there was the company reaching 500 million monthly active users ahead of recent internal forecasts and approaching $40 billion in payments to music labels and artists.

The company has executed a flurry of M&A and talent deals in the podcast sector in recent years, acquiring The Ringer, Gimlet Media and other producers and also setting pricey deals with Joe Rogan and other personalities. That has proven to be a financial strain, but Vogel said the company continues to believe that the investments will pay dividends and hit profit targets. “We’re still super-optimistic about the business and where it can go over time,” he said.

As far as the grueling macroeconomic environment, with inflation and foreign currency gyrations hurting revenue, Vogel said he had no update for investors since the company’s earnings report and investor day several weeks ago. “It was choppy coming out of Q4, it’s still been choppy into Q1,” he said.

Swinburne asked about Spotify’s competitive position versus larger tech players — specifically Apple, which stacks music and podcasting on top of TV, video games, cloud storage and a range of other services; and YouTube, which has made strides in music. “This is all we do,” Vogel said. “Our singular focus on streaming audio and giving the best possible experience to users, I think, separates us. That’s No. 1. No. 2 is, we have more engaged users.

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