SoundCloud is laying off 20 percent of its global workforce

Streaming company SoundCloud is cutting about 20 percent of its global workforce. Billboard reported on August 3 that SoundCloud CEO Michael Weisman told employees in a company memo that the change was mostly due to the current economic environment. Affected employees will be notified over the next several days.

"Today's change positions SoundCloud longer and puts us on a path to continued profitability," Weisman wrote in the memo. “We have already started making prudent financial decisions across the company and now this extends to the shortfall in our team.” In a statement to Billboard, a SoundCloud representative confirmed the news, saying: "During this difficult time, we continue to strengthen our commitment to carrying out our mission to lead what's next in music. We continue to do so. We are focused on providing support and resources to those making the transition."

In 2017, SoundCloud laid off about 40 percent of its workforce, citing it as essential to the company's "long-term, independent success."

In March 2021, SoundCloud implemented a new payout system that allocates funds paid by subscribers or advertisers directly to fans of artists who choose to stream, rather than pooling subscription and advertising money together, then Split it up based on which artists contributed the most streams, such as its competitors Spotify and Apple Music. In July, they struck a licensing deal with Warner Music Group to share the same royalty system.

SoundCloud is one of several tech companies that recently announced either layoffs (Tesla, Substack, Coinbase, and OpenC, to name a few) or adjustments to recruitment plans. In June, Spotify said in a company memo that it would reduce its hiring by 25 percent and would "evaluate" the company's "headcount growth." Other companies such as Google, Twitter and Meta have also recently announced hiring slowdowns and freezes, while Apple reportedly intends to slow hiring into 2023.