SoundCloud is closing its offices in London and San Francisco as it axes 40% of its workforce in a dramatic cost-cutting move.

The German-born streaming company has informed its staff today that 173 jobs are being cut, from a total headcount of 420.

The business will consolidate its operation across its New York and Berlin offices.

The last available annual accounts for SoundCloud are from 2015, when revenues were up 21.6% to $22 million, but net losses accelerated 30.9% to $52 million.

When these numbers were filed in January, SoundCloud CEO and co-founder Alexander Ljung noted that the company may “run out of cash” before the end of 2017 if it could not secure further financing.

Recent rumors have suggested that Deezer – majority owned by Len Blavatnik’s Access Industries – could acquire SoundCloud in the coming months.

“We need to ensure our path to long-term, independent success,” Ljung will say today in a blog post, according to Bloomberg.

He will add that the business has doubled its revenue over the past 12 months -but won’t reveal what’s happened to losses in that time.

Ljung adds: “By reducing our costs and continuing our revenue growth, we’re on our path to profitability and in control of SoundCloud’s independent future.”