Spotify Faces Backlash for Major Layoffs Ahead of Christmas

Spotify, the popular music streaming platform, is facing criticism for its decision to lay off nearly 20% of its workforce just before the holiday season. This move has sparked outrage among users, who have taken to social media to express their disappointment.

Spotify Wrapped Mockery

Users on X, a popular online platform, are mocking Spotify for its timing of the layoffs by parodying the company's signature "Spotify Wrapped" style. One user sarcastically commented, "That puts you in the top 3% of biggest layoffs this year from a tech company." This sarcastic remark highlights the magnitude of the layoffs and the negative impact it will have on the affected employees.

CEO's Statement

Spotify's CEO, Daniel Ek, acknowledged the impact of the layoffs in a memo to employees, stating, "I realize that for many, a reduction of this size will feel surprisingly large given the recent positive earnings report and our performance." Despite Spotify reporting its first quarterly profit in a year in October, the company still proceeded with the layoffs, which has raised concerns among users and the general public.

Multiple Layoffs in 2023

This is not the first time Spotify has implemented layoffs this year. According to Layoffs.fyi, the company previously reduced its workforce by 6% in January and an additional 2% in June. The recent layoffs, which amount to approximately 1,500 jobs, bring the total layoff percentage to 17% for the year.

Mocking Video

A user on X, @digi_chad42069, shared a video that further mocked Spotify's timing of the layoffs. In the video, the user humorously stated, "2023 was a feast for your shareholders. You laid off 17% of your employees a few weeks before Christmas LMAO." The video also jokingly listed "Marketing" as the top department affected and humorously advised fired employees to turn in their badges, emphasizing the irony of Spotify's "family-like" culture.

Stock Performance

Despite the backlash, Spotify's stock closed 7.5% higher on the day of the layoffs announcement. The stock has seen a significant increase of 137% this year, resulting in a valuation of nearly $38 billion. Additionally, the company reported a third-quarter operating profit of 32 million euros ($34.7 million) and a growth in paying subscribers to 226 million.

The decision to lay off a large portion of its workforce just before the Christmas holidays has clearly struck a nerve with Spotify users. The company's timing, despite its positive financial performance, has been met with criticism and mockery. Only time will tell how this move will affect Spotify's reputation and user base.

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By: kteo@insider.com (Kai Xiang Teo)
Title: Spotify Faces Backlash for Major Layoffs Ahead of Christmas
Sourced From: www.businessinsider.com/spotify-wrapped-2023-layoffs-before-christmas-2023-12
Published Date: Tue, 05 Dec 2023 05:16:16 +0000