or, otherwise said: "we fired you to make our bottom line look nicer"
One thing is to have layoffs when you are raking in record profits. This doesn't seem to be the case. The text makes a decent enough case.
Consider, for example, the number of people who thought turn of the century Apple should become a Windows reseller or, later, sell the iPod brand to a business which understood how to be successful in the phone market like Nokia. There were certainly times where that could have generated a great deal of short-term gain, and it was easy to find some analyst prattling on about why they had to do it.
In the case of Spotify, the only situation where 17% of their company is an unambiguous waste of money with no benefit to the future business should be accompanied by the CEO’s resignation because that would be an enormous managerial failure in the hiring process. Since it seems unlikely that even 1% of their workforce is that bad, it’s far more likely that this has nothing to do with long-term success and everything to do with pleasing the activist investors and consulting firms who’ve been pushing the idea of layoffs as a way to remind workers not to ask for more.
Spotify is one of the few companies that raises prices every year but somehow get further away from making a profit.
if the future prospects of the business doesn't look great despite the current record profits, a layoff is also not a bad decision. There's no reason why an employee is kept if that employee's work is not going to generate future profits. Current profits are already generated from past work of said employee.
Businesses need to be able to grow and shrink. Otherwise we just end up with "too big to fail".
A layoff this large means one of two things: the management screwed up on an epic scale (and should be the first to go) or it’s just giving investors a short-term stock boost at the expense of long-term success. Broad layoffs are usually bad for companies long-term because they signal both a lack of management skills and mean that everyone still working there is going to be worried about another round, so politics and making yourself harder to replace will consume a certain amount of otherwise productive time.
It must not be something impossible to do, but it must be hard. And they should favor most other courses of action.
But anyway, it's up to the government to enforce this, and the US (where they are hosted) seems to almost completely disagree. So we get those companies hiring like mad, just to fire like mad in a couple of years, and begin the cycle again a few years down.