Music streaming platform SoundCloud has made the decision to lay off 173 employees, or 8% of its workforce, with the aim of recording its first quarter of profitability. These changes are part of SoundCloud’s ongoing efforts to restructure its operations as it competes with larger players in the market such as Spotify and Apple Music.
According to sources within the company, CEO Kerry Trainor set a Q4 2019 target for SoundCloud to return to the black, leading to the recent cuts. After restructuring, all positions at the Berlin-based company will be reevaluated, following previous rounds of layoffs in 2017 and 2018 as the platform shifted to a subscription model.
SoundCloud has a global network of over 40 million creators and more than 130 million engaged fans. The restructuring will see the platform’s headcount reduced by 40% and the closure of offices in major cities like San Francisco, London, and Berlin. Despite the changes, CEO Kerry Trainor has emphasized that the platform is taking measures to stay profitable while retaining its community of creators and fans.
In recent years, SoundCloud has also expanded its partnerships with music labels and launched more granular royalty programs for artists. It has also launched features like a TikTok-like vertical feed for music discovery and a fan-engagement tool for artists.
The layoffs mark another potentially difficult chapter for SoundCloud, which has always prioritized supporting emerging artists and smaller labels. However, as the music streaming market grows increasingly competitive, SoundCloud may have to make difficult decisions to stay viable.
The future of SoundCloud remains to be seen, as the company’s attempt to shift towards profitability could see it move away from its core values and community. Nevertheless, the music streaming platform seems committed to finding methods to thrive in an ever-changing market.
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