Home > Latest News > Spotify CFO Leaves Amid 3rd Round Of Layoffs

Spotify CFO Leaves Amid 3rd Round Of Layoffs

The Chief Financial Officer (CFO) of Spotify, Paul Vogel has announced he will be leaving the company in the coming months. This news comes three days after plans were revealed to lay off 17% of staff during the third round of job cuts this year.

Vogel joined the company in 2016 and was tapped for the CFO position in 2020. In a press release, Spotify said he “will be leaving the company on March 31, 2024.”

CEO Daniel Ek said in a statement that the company was already searching for a new CFO, but in the meantime, Vice President of Financial Planning and Analysis, Ben Kung will take over.

“Spotify has embarked on an evolution over the last two years to bring our spending more in line with market expectations while also funding the significant growth opportunities we continue to identify.”

“I’ve talked a lot with Paul about the need to balance these two objectives carefully. Over time, we’ve come to the conclusion that Spotify is entering a new phase and needs a CFO with a different mix of experiences. As a result, we’ve decided to part ways.”

The imminent departure tops a dreadful week for Spotify, having recently announced it would be handing 17% of roughly 9,000 staff members a pink slip.

In a companywide email, Ek revealed Spotify was taking “substantial action to rightsize our costs” after the mass hiring that came from COVID years, when the benchmark federal funds rate in the US was around 3%.

By 2022, the Federal Reserve implemented a tightening regime, which sent interest rates to a 22-year-high, between 5.25% and 5.5%.

The most recent job cuts are expected to affect around 1,500 jobs, and terminated employees will receive “approximately five months of severance,” accrued and unused paid time off, as well as health insurance during the severance period.

“Being lean is not just an option but a necessity,” Ek continued.

This year alone, the company cut staff by 6% at the beginning of the year (600 staff). This included the Chief Content and Advertising Business Officer, Dawn Ostroff.

At the time, Ek sent a similar email notifying them the company was spending too much money, and was struggling to rein in costs despite “a considerable effort.”

Then, the company proceeded to lay off 2% of staff (200 jobs) in June, after Prince Harry and Meghan Markle’s podcast flopped.

Reportedly, the Duchess was paid over U$18 million for her “Archetypes” podcast, however, failure to grab the top spot led the company to let go of more staff.

This multimillion-dollar pay was part of a larger U$1 billion bet on podcasting that has seen top podcasters Joe Rogan, Alex Cooper, and Emma Chamberlain bring in massive windfalls. In order to accommodate the investment, Spotify continued letting staff go behind the scenes.

Joe Rogan however, is rumoured to be taking his popular ‘Joe Rogan Experience’ podcast to a rival, after his exclusive licensing deal expires with Spotify next year.

As part of their agreement, the company reportedly paid Joe Rogan U$200 million in 2020, but could be forced to pay more to keep him.

The podcast host has a range of options including striking out on his own by creating a media company, which would distribute the podcast, and produce other content that would appeal to his fanbase. Another option is possibly joining forces with Elon Musk.

In other news, Spotify has struggled to turn a profit, and in an apparent move to do so, it implemented a $1 increase across US plans in July.

The company has also been expanding into audio books, and is tipped to include access to book recordings in its ‘Supremium’ tier.

According to sources, the company is expected to release the priciest monthly subscription option within the coming months, providing listeners access to a “sound capsule” personalised to each user, as well as “24bit lossless audio.”

Subscribed users will also reportedly receive the option of listening to 30 hours of audio books per month, along with the ability to sort their library by mood, activity, and genre.

This subscription option shows Spotify’s attempt to right profits following a U$503 million loss in the first nine months of 2023.

Last year, Ek announced growth targets, including wanting the company to be profitable by 2024, and wanting to generate U$100 billion in revenue by 2030.



You may also like
Spotify Subscribers Grow As Publishers Demand Unlicenced Content Taken Down
Case Against Spotify Dismissed, Judge Says Bundling Is Fine
Spotify
Universal Inks Direct Licence Agreement With Spotify
Is Spotify’s Bundling Strategy Squeezing Artist Royalties?
Google Rolling Out Android Gemini Extension For Spotify

Popular Posts

EXCLUSIVE: Audio Connection Takes On French Audio Brand, Third Distributor In 4 Years
Latest News
/
/
Hackers on computers wearing face masks. Image: Microsoft Copilot
Urgent Upgrade Of Netgear Routers Recommended
Latest News
/
/
Amazon Struggling To Cope With AI Demand
Latest News
/
/
EXCLUSIVE: Yamaha Responds To Rumours That They Are Set To Quit The AV Market
Latest News
/
/
Apple Settles iPhone 7 ‘Loop Disease’ Lawsuit With US$350m Settlement
Latest News
/
/

Digital Magazines

Recent Post

EXCLUSIVE: Audio Connection Takes On French Audio Brand, Third Distributor In 4 Years
Latest News
/
//
Comments are Off
French audio brand Devialet is on the move again in Australia, this time it’s Audio Connection that is having a...
Read More