Spotify Cuts 200 Jobs in Podcast Department in Reorganization Plans

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Spotify announces to let go of 200 employees as it plans to merge Parcast and Gimlet into Spotify Studios.

Spotify announced Monday, June 4, its plan to cut around 200 jobs in its podcast department, which runs the platform Spotify For Podcasters. The announcement was made a few months after the company let go of 600 people in a significant wave of layoffs.

In an internal memo, Spotify podcast division head Sahar Elhabashi said the company "made the difficult but necessary decision" of reducing its workforce by 2% as part of its plans to merge Parcast and Gimlet Studios into Spotify Studios. The impacted employees, the statement added, have already been informed and were invited to talk with the company's HR department.

"We are expanding our partnership efforts with leading podcasters from across the globe with a tailored approach optimized for each show and creator," she wrote. "This fundamental pivot from a more uniform proposition will allow us to support the creator community better."

The company, Elhabashi added, promised affected employees they would get "generous" severance packages, "including extended Healthcare coverage and immediate access to outplacement support."

Consolidation by Acquisition

Spotify acquired Gimlet, Parcast, and Anchor in 2019 for a combined figure of $400 million. Anchor's platform, Anchor.fm, was renamed Spotify For Podcasters in March 2023.

Elhabashi noted the decision to merge Gimlet and Parcast was to allow Spotify Studios to focus on a more tailored partnership approach instead of a "uniform" one.

Meanwhile, The Ringer, which Spotify acquired in 2020 for an undisclosed amount, would remain a separate business unit from Spotify Studios. Podcasts managed by the Ringer primarily focus on sports coverage and pop culture.

In the statement, Elhabashi announced Spotify's vice president and head of global podcast studios Julie McNamara would continue to oversee Spotify Studios, while Bill Simmons would remain as The Ringer's managing director and head of podcast innovation and monetization.

Podcast Gains and Losses

Also included in the announcement were Spotify's metrics in its podcast business, saying they have reached 100 million podcast listeners on the platform across its 5 million programs. Podcast revenue also experienced a "high double-digit growth" from 2021 to 2022.

"Given these learnings and our leadership position, we recently embarked on the next phase of our podcast strategy, which is focused on delivering even more value for creators (and users!)," Elhabashi wrote.

Part of the company's move to develop its podcast business was to "[maximize] consumption" from its established audience through format innovation and ensuring "more creators in more places achieve success."

In addition to job cuts in its podcast department in the past year, Spotify has discontinued 11 of its original podcasts that were deemed to be underperforming to focus on its more popular programs and make room for new ones.

According to TechCrunch, Spotify's announcement was significant as it would lead to important changes in the company's original content strategy in the months to come.