SoundCloud Ltd. announced on Thursday that it is cutting nearly 40 percent of its staff and closing its offices in San Francisco and London.

The move comes as larger rivals in the streaming industry, like Spotify Ltd. and Apple Inc. (NASDAQ: AAPL), are increasingly improving and expanding, while SoundCloud has been operating in the red. In January, the music streaming service reported that it was at risk of running out of money.

Out of SoundCloud’s 420 employees, 173 jobs will be eliminated. While the San Francisco and London offices will shut down, the company’s operations will be consolidated at its headquarters in Berlin and New York location.

SoundCloud currently has about 175 million users, who rely on the platform for its expansive library of songs and playlists as well as its material which is updated daily. However, its lack of success can be attributed to the fact that most of the content on the site is free, with an exception to songs streamed through SoundCloud Go, the company’s failed attempt at a subscription tier.

Alex Ljung, SoundCloud’s co-founder and chief executive, noted that the goal of the cuts is to remain a standalone business. In recent years, the company has explored a sale to Twitter Inc. (NYSE: TWTR) and Spotify, but an agreement was never reached.

“We need to ensure our path to long-term, independent success,” Ljung said in a blog post published on SoundCloud’s website. He reported that the company has doubled its revenue over the past 12 months -- without providing specifics -- and that the cuts put it on a path to profitability. “By reducing our costs and continuing our revenue growth, we’re on our path to profitability and in control of SoundCloud’s independent future,”

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