The Swedish media streaming giant is one of the largest providers of its kind. Founded in 2006 by Ek and Martin Lorentzon, the company has grown tremendously over the years, with over 456 million monthly active listeners.
Ek posted an update on the Spotify blog on Monday morning about what changes will be happening within the company.
“In retrospect, I was too ambitious in terms of investing ahead of our revenue growth. And for this reason, today we are reducing our employee base by approximately 6% across the company,” Ek said in the memo. “I take full responsibility for the moves that got us here today.”
Ek stated that Spotify is committed to ensuring that all affected employees are treated fairly when leaving. Severance pay will be provided “with the average employee receiving approximately five months of severance pay,” as well as continued health care coverage during that time period. In addition, any unused paid leave will be paid out and immigration assistance will be provided to “employees whose immigration status is connected to their employment.” Finally, “all employees will be eligible for outplacement services for two months.”
These cuts come after other Big Tech companies announced their own layoffs last week. Alphabet, Google’s parent company, plans to lay off 12,000 employees, while Microsoft revealed it is cutting 10,000 jobs.