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Severance pay related to the layoffs could reach €45 million, but Bloomberg analysts led by Geetha Ranganathan wrote that Spotify’s “struggling” profit margins would be boosted. Analysts said Spotify could follow Apple Music’s recent price hikes, though the company will be hit by a worsening economy and a stronger dollar.
Spotify has been big on podcasting since 2019. He has spent over $1 billion on podcast networks, creation software, hosting services and rights to popular shows like The Joe Rogan Experience and Armchair Expert.
Still, this investment is testing the patience of investors. Stocks plunged last year as investors questioned when they would start making profits. Spotify executives said in June that the company’s podcast business would be profitable in the next year or two.
CEO Daniel Ek wrote in a blog post about the job cuts: “We still spend too much time synchronizing slightly different strategies, which slows us down. Efficiency becomes more important in a difficult economic environment. “
— Bloomberg News
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