Spotify founder Ek to step down as CEO to focus on long-term strategy

Spotify Founder-CEO Daniel Ek will step down to become executive chairman in January, the Swedish streaming company said on Tuesday as it adopts a new co-CEO structure in its strategy to fend off rivals and shore up its profit margin.

Billionaire Ek, who built Spotify into a rare global consumer technology leader from the region, will step back from day-to-day business as the company charts out its plan to keep ahead of music offering from YouTube, Apple and Amazon.

"Ek leaves the CEO role on a high note, with big boots to fill for the incoming CEOs," said PP Foresight analyst Paolo Pescatore. The U.S. shares of Spotify were down about 5% after gaining 63% this year.

Ek, a prominent tech entrepreneur of Europe, will focus on capital allocation and long-term strategy as executive chairman in what the company called a European-style role.

"I will be more involved than a typical US chairman. So think of it a little bit like moving from a player to a coach," said Ek, who has been on the company's board since 2008.

Spotify remains the clear market leader with nearly 700 million monthly users and more than 100 million tracks, far ahead of Apple Music's roughly 90 million subscribers.

But it faces competition from YouTube Music's vast video-integrated catalogue and Amazon Music's Prime-linked offerings, which give rivals distinct advantages in certain markets.

Despite Spotify's dominance, pressure on profit margins have persisted as artists push for higher payouts and the ad-supported tier expands.