Spotify has revealed plans to downsize its global workforce by approximately 17 percent. This decision comes on the heels of a 6 percent staff reduction earlier in the year, a move attributed to rising operational expenses.
The streaming giant reported a profitable third quarter, buoyed by increased subscription rates and price adjustments across its services, experiencing a surge in subscribers across all geographical regions. Projections for the upcoming holiday season estimate a monthly listener count of 601 million.
Spotify CEO Daniel Ek, in an interview with Reuters, emphasized the company’s pursuit of operational efficiencies to maximize returns. However, the recent decision to reduce staff by a significant margin appears contradictory to the positive financial performance reported.
“We debated making smaller reductions throughout 2024 and 2025,” Ek explained in an internal email to Spotify employees. “But considering the gap between our financial targets and existing operational costs, a substantial action became necessary to align our objectives.”
The announcement of a workforce reduction of this magnitude has stirred discussions about Spotify’s future trajectory, as it seemingly contradicts the positive earnings trend. Ek acknowledged the perceived abruptness of the decision but reiterated its necessity in aligning operational costs with financial goals.
Spotify has yet to provide specific details regarding which departments or regions will be affected by the downsizing, leaving employees concerned about their future within the organization.
This decision underscores Spotify’s commitment to financial optimization amidst a period of robust growth, sparking both speculation and concern within the company and the wider industry about the underlying reasons driving this substantial workforce reduction.
