Swedish audio streaming and media services provider Spotify has announced plans to lay off 200 employees in its podcast division which represents 2% of the company’s worldwide workforce.
The layoffs in the podcast division are coming months after the company cut 6% of its workforce in January this year, which impacted 600 employees.
In an internal memo shared by Spotify’s head of Podcast division Sahar Elhabashi, she announced that the company was making changes that would lead to a workforce reduction of 2%, noting that those who are impacted have already received an invite for a one-on-one conversation with someone from the HR department as Spotify is committed to ensuring each step is taken with utmost empathy and respect.
Part of the memo reads,
“We are expanding our partnership efforts with leading podcasters from across the globe with a tailored approach optimized for each show and creator. This fundamental pivot from a more uniform proposition will allow us to support the creator community better. However, doing so requires adapting over the past few months, our senior leadership team has worked closely with HR to determine the optimal organization for this next chapter.
“As a result, we have made the difficult but necessary decision to make a strategic realignment of our group and reduce our global podcast vertical and other functions by approximately 200 people, or 2% of Spotify’s workforce. Unfortunately, this means saying goodbye to close colleagues and friends. We know news like this is never easy, especially for those impacted. These decisions are not something we take lightly. I want to express my appreciation for everything those leaving have done for podcasting and Spotify.
“Our continued success in growing the podcast ecosystem is predicated on the necessity that the Spotify Machine is always in motion. And with these changes, we will accelerate into the next chapter for podcasts on Spotify with strong discovery and podcast habits for users, thriving monetization and audience growth for creators, and a valuable, high-margin business for Spotify. I want to thank everyone for your continued understanding and collaboration. I firmly believe in this team and that this next phase brings opportunities beyond anything we’ve seen”.
Spotify further disclosed that it will support laid-off employees with generous severance packages, including extended Healthcare coverage and immediate access to outplacement support.
In early 2019, Spotify saw an opportunity to invest in the rapidly growing podcasting space, and since then, it has helped transform the industry. The platform is the most-used audio podcast platform in most areas of the world, and is the No. 1 podcast publisher in the U.S. based on reach.
Its users and subscribers are based largely in the US and Europe, jointly accounting for around 53% of users and 67% of revenue. Overall, Spotify has more than 100 million podcast listeners.
The next phase of Spotify’s podcast strategy is focused on delivering even more value for creators and users. That starts with maximizing consumption from the massive audience it has established through format innovation and ensuring that more creators in more places achieve success. Simultaneously, in collaboration with the podcasting community, the company is broadening its analytics capabilities by expanding Spotify For Podcasters, which will help creators maximize their audience on Spotify and beyond.
