In one of the biggest round of layoffs announced so far, digital music service company Spotify (NYSE:SPOT) announced one of its biggest round of layoffs so far. The company announced it will layoff around 17% of its headcount or 1,500 of its employees. This is Spotify’s third round of layoffs after laying off 600 of its staff in January and 200 more people in June.
The company pointed out that it had hired a significantly large number of people in 2020 and 2021 to enhance its content, increased marketing and formation of new verticals. However, even after Spotify’s strong Q3 results, the company finds itself “in a very different environment.”
Giving the reason for the layoffs, Spotify added, “And despite our efforts to reduce costs this past year, our cost structure for where we need to be is still too big.”
Is Spotify Stock a Buy Right Now?
Analysts remain cautiously optimistic about SPOT stock with a Moderate Buy consensus rating based on 17 Buys and nine Holds. Even as SPOT stock has surged by more than 100% year-to-date, the average SPOT price target of $188.29 implies an upside potential of 4.2% at current levels.
