On the heels of the company’s third mass layoff of 2023, Spotify Chief Financial Officer Paul Vogel will be leaving the company. The move comes after Vogel sold $9.3 million of Spotify shares, coinciding with the company’s announcement of 1,500 job cuts on December 4.
Spotify CEO Daniel Ek was polite, yet clear about why Vogel was being let go in a press release: “Spotify has embarked on an evolution over the last two years to bring our spending more in line with market expectations while also funding the significant growth opportunities we continue to identify. I’ve talked a lot with Paul about the need to balance these two objectives carefully. Over time, we’ve come to the conclusion that Spotify is entering a new phase and needs a CFO with a different mix of experiences. As a result, we’ve decided to part ways.”
Profitability is what the streamer is struggling with the most as investors and shareholders tighten their grasp on the company. With workforce reductions of 6% in January and a further cut of 200 jobs in the podcast division in June, CEO Daniel Ek has set a public goal for Spotify to achieve profitability by the end of 2024, even as the company grapples to overcome previous costly decisions, particularly in podcasting.
Vogel also informed the stock market that upcoming severance costs are expected to result in a loss of between $100-$116 million for Spotify in Q4 2023.
Vogel will officially step down on March 31, 2024. In response, Spotify has initiated an external search for Vogel’s successor. Meanwhile, VP of Financial Planning and Analysis Ben Kung will assume expanded duties to facilitate the transition and reorganization of the financial leadership team.
Ek concluded by saying, “As we initiate the search for a new leader, we do so from a position of strength. I am enormously proud of the strides we’ve made as a company. We are on track to deliver against the goals we outlined at our Investor Day and our recent actions will help us accelerate these efforts. We look forward to tapping a strong financial leader as our next CFO and I will share more details soon.”
As for the sale of his shares, Vogel is drawing criticism for the timing. Spotify stock surged on the news of the layoffs. Additionally, Spotify General Counsel Eve Konstan, sold $1.1 million of shares, and board member Shishir Mehrotra sold $500,000.
