Dec 11, 2023
Spotify slashes staff to move faster into AI — and Wall Street loves it
Posted by Gemechu Taye in categories: business, robotics/AI
Spotify made a name for itself in the audio-streaming business through its hyper-personalized user experience, thanks to artificial intelligence and a team of 9,800 staffers at the end of 2022.
But after three rounds of layoffs in one year: 590 positions in January, 200 in June, and another 1,500 this week, Spotify’s investments into AI to boost margins for its podcasting and audiobook divisions look like a complete overhaul in strategy that Wall Street seems confident can work.
“Spotify is leveraging AI across its platform, launching AI DJ, simulating a traditional radio experience, in 50 additional markets and rolling out AI Voice Translation for podcasts,” said Justin Patterson, equity research analyst at KeyBanc Capital Markets, in a research note. “Coupled with audiobooks rolling out to Premium Subscribers, we believe Spotify has several opportunities to drive engagement and eventually stronger monetization.”
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