Music-streaming giant Spotify will cut 1,500 jobs, according to an announcement from Daniel Ek, its CEO, this morning.

The Swedish firm's intention to reduce its staff by 17% comes in the wake of tougher trading conditions for the business, which has a total workforce of around 9,000.

Mr Ek said: "Economic growth has slowed dramatically and capital has become more expensive. Spotify is not an exception to these realities.

"This brings me to a decision that will mean a significant step change for our company. To align Spotify with our future goals and ensure we are right-sized for the challenges ahead, I have made the difficult decision to reduce our total headcount by approximately 17% across the company. I recognize this will impact a number of individuals who have made valuable contributions. To be blunt, many smart, talented and hard-working people will be departing us."

Mr Ek added that "substantial action to rightsize our costs" was needed for the company to meet its objectives and that he understood the cuts would be "incredibly painful for our team".

Spotify's latest results showed a profit of £55.7m for the three months to September, which marked its first quarterly profit for more than a year. The uplift was attributed to price rises and higher subscriber numbers.

However, Spotify had considered making smaller reductions during 2024 and 2025, before concluding that more drastic action was needed to improve the company's longer-term finances.

In a direct note to employees, Mr Ek added that severence pay will start with "a baseline for all employees, with the average employee receiving approximately five months of severance. This will be calculated based on local notice period requirements and employee tenure."

Additionally, all accrued and unused leave will be paid out to any departing employee, while Spotify will extend its healthcare cover during the severance process.

Career support for new work will also be offered for two months.

● Spotify's announcement coincides with the reveal of its 2023 Wrapped, which crunches data for individual users and collates an overall review of music listening trends in 2023. Artist Sam Smith appeared at a special event to launch the latest review in London to launch the Wrapped review, which is now in its ninth year - and has become so popular that the Labour Party picked up on the social media reel with a spoof digest of the year's top tracks.