In early 2023, Spotify disclosed that it will cut 6% of its workforce as the operational expenses exceeded its revenue growth by 100%. Today, it is announcing another wave of layoffs.
This time, the company is cutting down its workforce employed in the Podcast business. Sahar Elhabashi, VP, Head of the Podcast Business, informed that the layoff will affect 2% of the podcast division, which totals up to 200 jobs. She elaborated in the blog post:
“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.”
Elhabashi mentioned that the company recently advanced in its podcast strategy which aims to deliver more value to customers and users. She added that Spotify is working on its analytics capabilities by expanding Spotify For Podcasters, which will help creators maximize their audience on Spotify and beyond.
These advancements, according to Spotify, require some changes and a “strategic realignment” of the group, hence the layoffs. The announcement added that the laid offemployees will get severance packages, which will include extended healthcare coverage and immediate access to outplacement support.
Elhabashi elaborated on the company’s new phase, where it will combine Parcast and Gimlet into a renewed Spotify Studios operation. This would allow the platform to continue producing original podcasts like Stolen, Science Vs, The Journal, etc. Parcast and Gimlet are studios that were acquired by Spotify for $56 million and over $200 million, respectively.
Furthermore, The Ringer, another podcast network previously acquired by Spotify, will continue producing Tech, Sports, and Culture related content. Lastly, the company executives overseeing the workings of the podcast division will continue providing their efforts for Spotify, although there will be more collaboration between the teams.