Streaming music service Spotify says it will lay off around 6 percent of its workforce, a move that will result in the elimination of about 600 positions across the company.
In a statement released on Monday, Spotify CEO Daniel Ek said he mistakenly believed the audio company’s robust suite of products — which include podcasts and, more recently, audiobook sales — would insulate the company from a slowdown in the advertising market.
“In hindsight, I was too ambitious in investing ahead of our revenue growth,” Ek admitted. “I take full accountability for the moves that got us here today.”
For affected workers, Spotify is promising severance pay that will be calculated based on employee tenure and other factors. Most employees will receive severance worth about five months of their usual income, Spotify said. Healthcare benefits will also be provided during the severance period.
Spotify said its human resources team is working with employees whose immigration visas are tied to their employment, but declined to offer specifics on how it would help.
One executive will be among those looking for a new job: Dawn Ostroff, Spotify’s chief content officer and the head of the company’s advertising business, will leave after five years. Gustav Söderström has been named chief product officer, and Alex Norström to the position of chief business officer. Norström will oversee both content and advertising in his new role.
“We’ve come a long way in our efforts to build a comprehensive platform for creators of all levels, but there’s still much to be done,” Ek said. “To truly become the go-to destination for creators, we need to keep improving our tools and technology, explore new ways to help creators engage with their audiences, grow their careers, and monetize their work.”
Ek said Spotify will announce new features for creators and listeners at its upcoming Stream On event, which is scheduled to take place on March 8.