Friday, July 25, 2025
LBNN
  • Business
  • Markets
  • Politics
  • Crypto
  • Finance
  • Energy
  • Technology
  • Taxes
  • Creator Economy
  • Wealth Management
  • Documentaries
No Result
View All Result
LBNN

Spotify Is Screwed | WIRED

Simon Osuji by Simon Osuji
December 4, 2023
in Artificial Intelligence
0
Spotify Is Screwed | WIRED
0
SHARES
0
VIEWS
Share on FacebookShare on Twitter


Just days after people gleefully posted their Spotify Wrapped, bad news came for the music streaming giant. Spotify announced today that it would cut 17 percent of its workforce, a chunk that equates to an estimated 1,500 people. It’s the third time the world’s largest music streamer has cut jobs this year.

The news came after Spotify posted its first profitable quarter since 2021. In a memo to staff, CEO Daniel Ek said the company had expanded its workforce and offerings significantly throughout 2020 and 2021, thanks to lower-cost capital, but is now bumping up against the same problems startups across industries are facing, like high capital costs and slowed economic growth.

Ek said the cuts may seem “surprisingly large given the recent positive earnings report and our performance,” but due to “the gap between our financial goal state and our current operational costs,” Spotify would take “substantial action.”

Despite its popularity (Spotify held 30 percent of the music streaming market by late 2022), the company has long struggled to turn consistent profits. The layoffs wrap up a bad year: Spotify cut 6 percent of its workforce last January, followed by another 2 percent in June as it slimmed down its podcasting business. Even as the world’s most recognizable music streaming service, Spotify is plagued by an unreliable business model, one in which record companies sit back and rake in royalty payments while artists can struggle to bring in enough cash.

“Investors are increasingly impatient in 2023 for tech firms to start making money,” says Phil Bird, head of rights at royalties at software development company Vistex. Spotify isn’t alone—tech companies have slashed jobs throughout the year, with more than 250,000 people losing jobs worldwide in 2023, according to layoffs.fyi, a site that tracks job cuts in tech.

Many major tech companies that overhired during the pandemic have taken steps to right-size—and that’s what Ek says Spotify is doing now. But Spotify’s high cost to license music adds to its financial strain. “The cost of doing business is huge for streaming companies,” Bird says.

Spotify gained momentum in the third quarter of 2023, earning €32 million ($34.6 million) in operating income. It now has 226 million subscribers and 574 million monthly users. “On the surface, it looks great,” says Simon Dyson, senior principal analyst of music and digital audio at consultancy firm Omdia. “It’s [those] nagging costs that it can’t get on top of.”



Source link

Related posts

Zenbivy Light Bed Review: Still the Best Backcountry Sleep System

Zenbivy Light Bed Review: Still the Best Backcountry Sleep System

July 25, 2025
Cursor’s New Bugbot Is Designed to Save Vibe Coders From Themselves

Cursor’s New Bugbot Is Designed to Save Vibe Coders From Themselves

July 25, 2025
Previous Post

Prax to buy out Total from Natref refinery

Next Post

Deadly but tricky to fly, suicide drones have Ukraine putting thousands of soldiers through pilot training

Next Post
Deadly but tricky to fly, suicide drones have Ukraine putting thousands of soldiers through pilot training

Deadly but tricky to fly, suicide drones have Ukraine putting thousands of soldiers through pilot training

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

RECOMMENDED NEWS

Dyson Has Killed Its Bizarre Zone Air-Purifying Headphones

Dyson Has Killed Its Bizarre Zone Air-Purifying Headphones

1 month ago
Missouri Attorney General’s War to Keep the Wrongly Convicted Locked Up

Missouri Attorney General’s War to Keep the Wrongly Convicted Locked Up

1 year ago
The Best Clitoral Suction Toys (2024), Tested and Reviewed

The Best Clitoral Suction Toys (2024), Tested and Reviewed

10 months ago
Breakout for Stocks or Fake Out?

Breakout for Stocks or Fake Out?

2 years ago

POPULAR NEWS

  • Ghana to build three oil refineries, five petrochemical plants in energy sector overhaul

    Ghana to build three oil refineries, five petrochemical plants in energy sector overhaul

    0 shares
    Share 0 Tweet 0
  • When Will SHIB Reach $1? Here’s What ChatGPT Says

    0 shares
    Share 0 Tweet 0
  • The world’s top 10 most valuable car brands in 2025

    0 shares
    Share 0 Tweet 0
  • Top 10 African countries with the highest GDP per capita in 2025

    0 shares
    Share 0 Tweet 0
  • Tanzania’s natural gas sector goes global with Dubai deal

    0 shares
    Share 0 Tweet 0
  • Privacy Policy
  • Contact

© 2023 LBNN - All rights reserved.

No Result
View All Result
  • Home
  • Business
  • Politics
  • Markets
  • Crypto
  • Economics
    • Manufacturing
    • Real Estate
    • Infrastructure
  • Finance
  • Energy
  • Creator Economy
  • Wealth Management
  • Taxes
  • Telecoms
  • Military & Defense
  • Careers
  • Technology
  • Artificial Intelligence
  • Investigative journalism
  • Art & Culture
  • Documentaries
  • Quizzes
    • Enneagram quiz
  • Newsletters
    • LBNN Newsletter
    • Divergent Capitalist

© 2023 LBNN - All rights reserved.