Breaking: Pandora Announces Layoffs; 7% Getting Axed

Pandora Offices, New York
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Pandora Offices, New York
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Pandora Offices, New York

Pandora, the internet radio service, is cutting 7% of its workforce after a disappointing year. The decision, which will not affect Ticketfly, the ticket-selling service that Pandora purchased for $450m last year, will result in 155 employees losing their jobs. The company aims to reach full-year adjusted EBITDA profitability in 2017. The decision to lay off staff was described as “difficult” by CEO Tim Westergren, but he said it would allow the company to invest more into product development and strategic investments. Pandora counts nearly 80 million unique users and advertising is its largest source of revenue.

The layoff announcement follows a year in which Pandora was not able to compete with Spotify and Apple Music. Spotify and Apple Music gained large numbers of paying subscribers, with nearly 50 million now “going premium”. According to DMN estimates, more than 100 million consumers are paying for streaming music services. Surprisingly, Pandora added premium subscribers of its own. In the last quarter, the company added 375,000 new Pandora Plus subscribers, bringing the total to more than 4.3 million, however, these are $5 subscriptions.

The layoff announcement came after Sirius XM Radio, the satellite radio provider, reportedly ended talks of a buyout of Pandora. The stock jumped 20% on rumours of the buyout, but fell back to earth when the Sirius deal fell through. Pandora has struggled to compete with Spotify and Apple Music, and as a result, the company has seen its stock fall more than 60% over the past 12 months. In December, Pandora announced that it was selling Ticketfly. The sale was not a surprise, as the division was not performing as well as Pandora had hoped. The company purchased Ticketfly for $450m in 2015.

In an earnings call last year, Westergren said that Pandora was going to focus on advertising and developing new products. The company has been working on a new on-demand service to compete with Spotify and Apple Music. The service has not been released yet, but it has been in development for some time. The company has also been working on a partnership with T-Mobile. The partnership would allow T-Mobile customers to access Pandora for free, and it would give Pandora access to 70 million potential new users.

In the meantime, Pandora has been adding new features and functionality to its existing service. The company recently introduced a new feature called “Thumbprint Radio”. This radio station is built around the user’s “thumbs up” songs. The more songs a user likes, the better the station becomes. Pandora is also rolling out new features to its advertising platform. The company has been working on a new ad technology that will allow advertisers to target specific audiences with their ads.

Pandora has been a pioneer in the music streaming industry, but the company has struggled to compete with Spotify and Apple Music. The company has been trying to adapt to the changing market by investing in new products and advertising. The company’s layoff announcement is part of its plan to focus on product development and strategic investments. The company is hoping that these investments will help it compete with Spotify and Apple Music, and return it to profitability.

More as this develops.

One Response

  1. Remi Swierczek

    Talk to Larry Page at Google music PIMPING house how to convert 100,000 Radio stations to $100B music store. Pandora, XM, Spotify or AppleMusic would be the biggest ones with revenues in billions!

    PLAY THE BEST YOU CAN and charge for addition to your personal PLAY LIST!