Over-spending and under-pricing: Spotify’s commercial missteps have come back to haunt it.

In his reasoning for cutting 6% of Spotify’s global workforce, Daniel Ek wrote: “In 2022, the growth of Spotify’s [operating expense] outpaced our revenue growth by 2X. That would have been unsustainable long-term in any climate, but with a challenging macro environment, it would be even more difficult to close the gap.” Added Ek: “In hindsight, I was too ambitious in investing ahead of our revenue growth.” That’s something of an understatement.

Source: Over-spending and under-pricing: Spotify’s commercial missteps have come back to haunt it.

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