CFO, Paul Vogel, to step down from Spotify amidst layoffs

In a surprising turn of events, the Chief Financial Officer (CFO) of Spotify, Paul Vogel, is set to depart the company after cashing out millions of shares just a day after a massive layoff that affected 17% of Spotify’s workforce.

Music Business Worldwide (MBW) reported that Vogel exercised 47,859 shares of Spotify stock, amounting to a staggering $9.377 million (around £7.3 million) on December 5th. Notably, this stock sale occurred just 24 hours after Spotify announced the layoffs, which affected approximately 1,500 employees globally. As per MBW’s findings, Vogel’s annual base salary for 2022 was $600,000, but he also received options awards worth $6.187 million.

Spotify CEO Daniel Ek has released a statement regarding Vogel’s departure, acknowledging the company’s “evolution” over the past two years to align spending with market expectations while still pursuing growth opportunities. He acknowledged the need to balance these objectives, adding that Spotify has decided to part ways with Vogel as the company enters a new phase requiring a different skill set.

Ek expressed gratitude for Vogel’s contributions, particularly his support during the pandemic and economic uncertainty. He also mentioned Spotify is also on track to meet its Investor Day goals and that the search for a new CFO will be conducted from a position of strength. Despite the layoffs, Spotify emphasised its commitment to its employees and offered five months of redundancy pay and five months of healthcare coverage to those affected by the recent round of job cuts.

Vogel’s departure and the recent layoffs have raised concerns about Spotify’s financial health and its ability to compete in the increasingly crowded streaming music market. Spotify has been struggling to generate consistent profits, and the company has faced increasing competition from rivals such as Apple Music and Amazon Music.

This isn’t the first time Spotify has implemented layoffs in 2023. In January, the company announced plans to eliminate 600 roles and further reduced its workforce by 200 in June.

Image credits: Spotify