The Pulse #72: Spotify’s Shock Cuts
Despite its stock more than doubling in value in a year, the streaming giant is cutting 17% of its staff. But why? Also: Twitch shuts down in Korea and OpenSea’s revenue plummets 99% in 18 months.
The Pulse is a series covering insights, patterns, and trends within Big Tech and startups. Notice an interesting event or trend? Send me a message.
Today, we cover:
Industry pulse. A roundup of recent events, with commentary. Google announces Gemini, Amazon’s Q assistant and new AI chip, and Auth0 triples prices for small customers.
Spotify’s shock cuts: inevitable? Spotify’s stock price more than doubled in the past 12 months, and the mood has been positive across the company. And yet 17% of staff are being let go, with the news seemingly coming out of thin air. But Spotify has business challenges which its strong stock performance has masked.
Twitch shuts down in South Korea. The South Korean government has mandated egress fees for foreign content providers – basically, pay to send data to users. Such a fee usually means a price increase for paid services, but has resulted in Twitch exiting the country because it couldn’t make the economics work. It’s a worrying precedent, with other countries considering similar anti-net neutrality policies.
NFTs are Over. Revenue is down 99% at market-leading NFT platform, OpenSea; from $200M in May 2022, collapsing to $1.9M in October 2023. The company likely needs to pivot and execute painful cuts.
Uber joins the S&P 500 index. Uber should already have been on the S&P 500 index by its market cap, but profitability is a requirement for admittance. Now Uber has its first-ever profitable quarter under its belt. Being on this index should boost the company’s share price – and it’s a big milestone, generally.