Spotify Cuts 200 Jobs Within its Podcasting Unit
Spotify, the popular audio streaming company, is implementing a workforce reduction in its podcasting unit, resulting in 200 employees being laid off, which accounts for approximately 2% of the company’s global workforce.
In a statement released on Monday, the Sweden-based company acknowledged the difficult decision it had to make, describing it as a strategic realignment within its podcast department. As part of this realignment, Spotify will be merging the Parcast and Gimlet Media studios into a single entity. However, Bill Simmons’ sports podcast, “The Ringer,” will remain separate.
Spotify’s Vice President, Sahar Elhabashi, emphasized the company’s intention to expand partnership efforts with prominent podcasters worldwide. The company plans to take a tailored approach, optimizing its support for each show and creator. This shift from a more uniform proposition is aimed at better serving the creator community.
Over the past few years, Spotify has made significant investments in the podcasting industry. In 2019, the app was redesigned to highlight podcasts, and the company has spent over $500 million on podcast producing studios. Spotify also has exclusive distribution rights for various podcasts, including popular shows like “The Joe Rogan Experience” and “Call Her Daddy” hosted by Alex Cooper.
Despite its podcasting endeavors, Spotify has been scaling back on exclusives. Deals with figures like self-help guru Brené Brown, sports journalist Jemele Hill, and former US President Barack Obama and Michelle Obama are set to expire.
Spotify, boasting 100 million podcast listeners, claims to be the leading podcast publisher in the United States. The company also noted substantial growth in podcast ad revenue, experiencing high double-digit growth from 2021 to 2022.
This marks the second round of layoffs for Spotify this year. In January, the company had to reduce its global workforce by approximately 6% due to a slowdown in advertising spending caused by the pandemic.
CEO Daniel Ek reflected on the challenges faced, stating, “Like many other leaders, I hoped to sustain the strong tailwinds from the pandemic and believed that our broad global business and lower risk to the impact of a slowdown in ads would insulate us. In hindsight, I was too ambitious in investing ahead of our revenue growth.” Notably, the previous round of layoffs included the departure of Dawn Ostroff, the chief content officer, who had overseen several podcasting deals during her tenure.
