Severance pay: We will start with a baseline for all employees, with the average employee receiving approximately five months of severance.These meetings will take place before the end of the day on Tuesday, and while Katarina will provide more detail on all of the specifics, please know the following will apply to all of these bandmates: If you are an impacted employee, you will receive a calendar invite within the next two hours from HR for a one-on-one conversation. I know you will all be anxious to hear the next steps about how this process will work. In two words, we have to become relentlessly resourceful. More people need to be focused on delivering for our key stakeholders – creators and consumers. Today, we still have too many people dedicated to supporting work and even doing work around the work rather than contributing to opportunities with real impact. While we have done some work to mitigate this challenge and become more efficient in 2023, we still have a ways to go before we are both productive and efficient. By most metrics, we were more productive but less efficient. But, at the same time, the reality is much of this output was linked to having more resources. When we look back on 20, it has truly been impressive what we have accomplished. And despite our efforts to reduce costs this past year, our cost structure for where we need to be is still too big. However, we now find ourselves in a very different environment. These investments generally worked, contributing to Spotify’s increased output and the platform’s robust growth this past year. In 20, we took advantage of the opportunity presented by lower-cost capital and invested significantly in team expansion, content enhancement, marketing, and new verticals. To understand this decision, I think it is important to assess Spotify with a clear, objective lens. While I am convinced this is the right action for our company, I also understand it will be incredibly painful for our team. Yet, considering the gap between our financial goal state and our current operational costs, I decided that a substantial action to rightsize our costs was the best option to accomplish our objectives. We debated making smaller reductions throughout 20. I realize that for many, a reduction of this size will feel surprisingly large given the recent positive earnings report and our performance. I hope you know that your contributions have impacted more than half a billion people and millions of artists, creators, and authors around the world in profound ways. Thank you for sharing your talents with us. To be blunt, many smart, talented and hard-working people will be departing us.įor those leaving, we’re a better company because of your dedication and hard work. I recognize this will impact a number of individuals who have made valuable contributions. To align Spotify with our future goals and ensure we are right-sized for the challenges ahead, I have made the difficult decision to reduce our total headcount by approximately 17% across the company. This brings me to a decision that will mean a significant step change for our company. Spotify is not an exception to these realities. Economic growth has slowed dramatically and capital has become more expensive. While we’ve made worthy strides, as I’ve shared many times, we still have work to do. Over the last two years, we’ve put significant emphasis on building Spotify into a truly great and sustainable business – one designed to achieve our goal of being the world’s leading audio company and one that will consistently drive profitability and growth into the future. Earlier today, CEO Daniel Ek shared the following note about the company’s organizational changes with all Spotify employees.
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