Pandora Radio powered by the Music Genome Project has gained large popularity in New Zealand, Australia, and the United States for its pioneering business form. The company does not only broadcast great music, but it also creates playlists for each user based on their musical preferences. However, Pandora Media Inc. is losing ground because of increased market competitiveness. The online music streaming industry has been gaining ambitious players in the last years. To remain competitive, the company announced a series of layoffs.
Tim Westergren, the chief executive at Pandora, made a statement on Thursday. He announced that the workforce of Pandora would be trimmed by 7%. He declared that such a decision was far from being an easy business strategy. However, the company wants to redirect major funds to monetization and product development. Furthermore, the recent strategic investments will also receive financial support to grow into something bigger. Nonetheless, the company based in Oakland had a successful quarter with 4.3 millions of paying subscribers.
Pandora Media Inc. lost 10% of shares in the past three months. As a consequence, the company wants to mobilize its assets and exceed expectations in the fourth-quarter. By the end of the year, the Internet radio network intends to gather a higher number of subscribers than experts are predicting.
After the public announcement, the Pandora shares saw a rapid increase of 7.4% on Thursday during after-hours trading. The value per share spiked to $12.89. The stock was already boosted by an 11 cents growth in the first part of the day and managed to reach $12.
The LinkedIn profile of the company shows that there are between 1,000 and 5,000 Pandora employees with 2,500 workers in U.S. alone. The layoffs will happen only within the United States except the Ticketfly project owned by the company. These numbers show that there are about 177 employees who will have to leave their positions by the end of the first quarter of 2017.
The company plans to remain competitive by offering appealing price packages. The Internet radio service will allow its subscribers to unlock the premium package for just $4.99. This new price is half of what it used to be and also much bellow the offers from Apple Music and Spotify. The company also intends to add a feature of on-demand music.
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