Spotify is scaling back its podcast unit with a 2% workforce reduction

Popular music streaming platform, Spotify, is set to lay off 200 employees in its podcast unit, which accounts for a 2% reduction in its workforce – a few months after announcing a restructuring that resulted in nearly 600 job cuts globally.

In terms of user growth, Spotify reported 489 million monthly active users in its fourth-quarter results last year, marking a 20% increase compared to the previous year. The company highlighted the growth in India and Indonesia as notable achievements. But, despite its user expansion, Spotify continues to face financial losses due to its heavy investments in podcasts.

Acquisitions of podcast networks like Anchor and Gimlet in 2019 were meant to bolster Spotify's business, but subsequent layoffs raised questions about the profitability of these ventures.

And while this development may raise eyebrows, Spotify is quick to assure that this move is part of a larger strategy aimed at expanding its partnerships with top podcasters worldwide. By tailoring its approach to cater to each show and creator, Spotify claims it is fine-tuning its podcasting prowess.