Spotify shares surged over 7% on Monday following the announcement that the music streaming giant will be reducing its workforce by 17%. In an email to staff, CEO Daniel Ek explained the move, stating, “We are taking substantial action to rightsize our costs.” Ek acknowledged that Spotify had overexpanded its team during 2020 and 2021 when capital was abundant.

This round of layoffs, approximately 1,500 jobs, reflects Spotify’s effort to adjust to a growth slowdown. Although Spotify reported a profit of 65 million euros ($70.7 million) in the third quarter, Ek highlighted the need for the company to address economic challenges and the rising cost of capital.

Spotify announces a layoff of 17% of its workforce in its effort for profitability following Taylor’s Swift $100 million payout from song streams.

In an internal memo posted on Spotify’s website, Ek expressed the company’s commitment to becoming the world’s leading audio company while ensuring consistent profitability and growth. The layoffs come despite Spotify’s strategic moves, including subscription plan price increases and expansion into podcasts and audiobooks.

This recent workforce reduction follows previous cuts earlier in the year, with Spotify trimming 6% of its workforce in January (around 600 employees) and an additional 2% in June (approximately 200 roles). Despite these adjustments, Spotify’s shares have more than doubled in value throughout the year. Wells Fargo analysts suggest that these layoffs signal Spotify’s focus on achieving profitability targets rather than merely reacting to economic challenges, estimating a potential nearly 2% reduction in operating expenses by 2024.

Tom McGeoch, who goes by the moniker Tomsy, has released a radio-ready pop track titled “321” along with a music video. Tom captures the best moments reminiscent of Charlie Puth and The Weeknd in one song. The song could easily secure a spot on Spotify’s “Pop Rising,” “All Out 80s,” “Pop Up,” and “Indie Pop” playlists.

Tomsy says about the song, “When crafting ‘3, 2, 1,’ the second verse found its inspiration in the midst of a hospital emergency room, illustrating that love’s most profound moments often spring from the unlikeliest of settings. This verse captures the raw and authentic emotions that define the essence of the song.”

Hailing from Columbus, Ohio and now based in Los Angeles, Tom McGeoch started playing the drums in pop-punk bands. After graduating from Berklee College of Music, he moved to LA to pursue a music career. Although he began with drumming, Tom sees himself as a creative artist first. He’s supported more than 100 artists and bands through drumming, songwriting, and producing.

100,000 new tracks are being uploaded to Spotify every day surpassing 60,000 last year.

100,000 new tracks a day, equates to 700,000 per week, 2,800,000.00 per month, and 33.6 million a year. Within the next 10 years, a whopping new 330 Million tracks will be uploaded to streaming services.

Apple’s Global Head of Editorial, Rachel Newman, said: “Today, anywhere in the world, in 167 countries and regions on Apple Music, any artist of any description can write and record a song and release it globally. Every day, over 20,000 singers and songwriters are delivering new songs to Apple Music — songs that make our catalog even better than it was the day before.”

Universal Music Group CEO Sir Lucian Grainge argued the amount of music being uploaded creates a frustrating experience for the user searching for new music. He also said it was harder to break new artists simply because they are competing with an enormous amount content.

Spotify is setting new goals. The main target for the platform is reaching $100 billion in 10 years.

“So from everything I see, I believe that over the next decade, we will be a company that can generate $100 billion in revenue annually, and that we can achieve a 40 percent gross margin and a 20 percent operating margin,” the 39-year-old said

It appears that Spotify will compete with TuneCore and Distrokid with more music marketing tools.

Charlie Hellman, VP and global head of music product mentioned that the platform will offer new tools and insights that artists can pay for.

“Because there’s so much being added to Spotify every day,” said Hellman, “artists need tools that will help them stand out, now more than ever. … In a lot of ways these monetization businesses are where our promotion businesses stood a couple years ago – early stage but with huge potential.

“These marketplace businesses have been the primary factor in growing our music gross margins,” Hellman emphasized to wrap up the speech. “And given the strong growth rates, this revenue will continue to be the primary driving force to help us further improve those margins.”

‘There are many things that Joe Rogan says that I strongly disagree with and find very offensive,’ Chief Executive Daniel Ek said at a company town hall on Wednesday.

But ‘if we want even a shot at achieving our bold ambitions, it will mean having content on Spotify that many of us may not be proud to be associated with.’

‘Not anything goes, but there will be opinions, ideas, and beliefs that we disagree with strongly and even makes us angry or sad,’ he added.

‘I want to remind everyone of our mission. We want to get to 50 million creators and a billion users. And to be a true platform and achieve this ambition, it’s really critical that creators are able to use their voice independently. And it’s also critical that we have diverse voices on our platform,’ he said at the town hall.

‘We’re not in the business of dictating the discourse that these creators want to have on their shows.’

‘Even though JRE is an exclusive, it is licensed content. It is important to note that we do not have creative control over Joe Rogan’s content.

‘We don’t approve his guests in advance, and just like any other creator, we get his content when he publishes, and then we review it, and if it violates our policies, we take the appropriate enforcement actions.’

We’re defining an entirely new space of tech and media. We’re a very different kind of company, and the rules of the road are being written as we innovate,’ he said.

‘I understand the premise that because we have an exclusive deal with him, it’s really easy to conclude we endorse every word he says and believe the opinions expressed by his guests. That’s absolutely not the case.’