Spotify (SPOT) announced on Tuesday that it has signed a weekly podcast deal with comedian Trevor Noah, days after the company said it was parting ways with Prince Harry and Meghan Markle.
The unnamed podcast, set to launch later this year, will "feature in-depth and freewheeling conversations between Trevor and some of the most influential and interesting figures around the world," according to a press release.
The news comes after Spotify revealed late last week it won't be renewing its podcast deal with the production company founded by Prince Harry and Meghan Markle, Archewell Audio, less than a year after the debut of Markle's first podcast, "Archetypes."
"Spotify and Archewell Audio have mutually agreed to part ways and are proud of the series we made together," Spotify and Archewell Audio announced in a joint statement on Thursday. No reason was given for the split.
The audio giant has been streamlining its podcast division after it spent $1 billion pushing into the podcast market over the past four years with splashy A-list deals and $400 million-plus studio acquisitions.
That spending took a significant bite out of gross margins and heavily weighed on profitability. Investors punished the company as a result, with the stock down a whopping 70% in 2022.
The partnership with Noah joins Spotify's other high-profile deals from creators including Alex Cooper, Emma Chamberlain, and Dax Shepard.
"It’s really exciting to be joining Spotify on a fun new adventure where we’ll engage in interesting and meaningful conversations with some of the world’s most fascinating people," Noah said in a statement.
The company added that "partnering with Trevor Noah, one of the world’s most brilliant and distinctive voices, will make for captivating storytelling that will delight our more than 100 million podcast listeners around the world."
Spotify's stock was down about 2% in afternoon trading following the announcement.
A new subscription tier
Spotify, which previously told Yahoo Finance it will look to improve its profitability rates beginning in 2023 on a gross margin and operating income basis, categorized 2022 as a peak investment year.
So far, it seems to be fulfilling that promise, pivoting away from a growth-at-all-costs strategy and realigning the podcast division.
Earlier this month, the audio giant announced it'd be eliminating 200 jobs, or 2% of its workforce, within its podcast division, citing "a strategic realignment." Part of that realignment included merging its previously purchased Parcast and Gimlet studios to join the broader Spotify Studios in producing original content.
The company cut 6% of its workforce, or about 600 employees, earlier this year. At that time, it announced a business restructuring that led to the departure of chief content officer and advertising business officer, Dawn Ostroff, who led the bulk of Spotify's splashy podcast deals.
As Spotify looks to further improve margins, Bloomberg reported the audio giant plans to roll out a more expensive, premium subscription tier that will feature improved audio capabilities and more access to audiobooks. This comes as investors have pushed the company to hike prices across its various plans.
The reported tier, dubbed "Supremium" internally, will launch internationally before debuting in US markets by October, Bloomberg said.
In a statement, a Spotify Spokesperson told Yahoo Finance, "We are constantly iterating and ideating to improve our product offering and offer value to users. But we don’t comment on speculation around possible new features and do not have anything new to share at this time."
Alexandra Canal is a Senior Reporter at Yahoo Finance. Follow her on Twitter @allie_canal, LinkedIn, and email her at [email protected]
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