Which IT firms have made workforce reductions?
Current revelations at Snap include the firing of around 20 percent of the company’s workforce as well as the decision to shelve its original programs, in-app games, and other initiatives.
It is the most recent example of a technology corporation cutting down on hiring, laying off substantial percentages of its workforce, and halting previously expanding side endeavors.
This year, several technology companies, including Robinhood and Lyft, have taken decisions that are very similar to one another.
According to CEO Evan Spiegel, the company’s revenue growth leveled off in July and then picked back up to 8 percent in August. Prior to this recent change, Snap, like many other tech companies, had been enjoying a robust revenue growth of 40 percent. However, this growth leveled off.
According to The Verge, Spiegel wrote the following in a business message that was sent on Wednesday: “Unfortunately, given our current reduced pace of revenue growth, it has become evident that we must cut our cost structure in order to prevent incurring severe recurring losses.”
“While we have established considerable capital reserves and have taken great measures to prevent reductions in the size of our team by avoiding cutbacks in the amount of our spending in other areas, we must now confront the implications of our reduced revenue growth and adjust to the market climate,”
Snap attributed a decrease in marketing spend to Russia’s invasion of Ukraine; however, the move is part of a larger trend in which technology companies reduce staffing costs after a recent spike in demand.
According to Marketplace, one of the reasons for this is that the epidemic caused an enormous increase in demand for technological goods and services, but that desire is starting to level out.
In an interview with Marketplace, Dan Ives, managing director at Wedbush Securities, said that “during the epidemic, the strong became stronger in tech.” “Everyone’s sitting at home streaming, to software, to the cloud,” as far as e-commerce is concerned, everyone does this.
This, however, is beginning to change. J. P. Gownder, an analyst at the research company Forrester, said in an interview with Marketplace that many technology businesses “legitimately have performance difficulties,” but others “are just being a little bit careful and slowing things down.”
According to Layoffs.fyi, a website that tracks job layoffs at startups and firms that have just gone public, more than 37,000 employees have been removed this year, however at the same time in 2021, there would only have been 3,000 positions destroyed.
And according to a survey that was conducted in 2022, 42 percent of tech workers reported that they had recently been laid off from their hybrid roles. Furthermore, 43 percent of respondents said that they were somewhat surprised to be dismissed, whereas only 14 percent reported that their organization had announced the possibility of layoffs in the past.
One thing, however, can be said with absolute certainty about the year 2022: it was the year in which tech companies began laying off employees.
Calm
According to the Wall Street Journal, the meditation and health app Calm terminated the employment of around twenty percent of its workers, or ninety individuals, in August of 2022.
According to the Wall Street Journal, Chief Executive David Ko reportedly told staff in a message that he was sending out, “Regrettably, today we are cutting our whole employment by 20 percent.” “Even if just some of you may be influenced, you will all be impacted in some way. I can promise you that this was not an easy choice to make; nonetheless, it is particularly difficult for a firm like ours, whose goal is centered on the mental health and wellbeing of employees in the workplace, to make such a decision.”
Groupon
According to TechCrunch, the business eliminated the jobs of approximately 500 workers, which is equivalent to 15 percent of its total workforce. Most of the employees worked in merchant development, sales, recruitment, engineering, product, and marketing. Others worked in engineering.
In an interview with TechCrunch, CEO Kedar Deshpande said that the company’s “total business performance is not at the levels we expected,” and that “we are taking urgent initiatives to change our trajectory.”
Robinhood
The financial services app laid off roughly 300 staff in April and more than 700 more in August, according to a statement from Robinhood. More than one thousand employees, which is about thirty percent of the company’s overall workforce, were let go.
In a statement, CEO and co-founder Vlad Tenev said that taking this action “wasn’t easy,” but that it was a deliberate step to ensure that the company would be able to continue delivering on its strategic goals and furthering its mission to democratize finance.
“While the decision to undertake this action wasn’t easy,” Tenev said. “Through 2022, we plan to keep stepping up the pace of our product development and roll out a number of important new offerings in the areas of brokerage, cryptocurrency, and spending/saving.
We are committed to retaining and continuing to recruit excellent people in essential jobs, and we will also give our workers with more chances for learning and career advancement.
And naturally, the pace of our foreign growth activities will pick up considerably from this point forward.”
OnlyFans
According to a report published in August by Business Insider, layoffs were conducted at OnlyFans; however, it is not known precisely how many employees were terminated from their positions.
Change.org
Change.org’s Chief Senior Officer, Nick Allardice, said that the organization has made the decision to let go of staff “across all of our departments and at every level, from entry level to executive.”
Overall, Allardice was forced to let go of 19 percent of his workforce.
According to a statement released by Allardice, “We are reorganizing in order to double-down on giving this next generation of leaders with the infrastructure they need to launch future movements.”
“Although petitions will continue to be a component of their toolset, we will be going much beyond that by assisting them in generating sustainable revenue and mobilizing their audiences across a variety of activities and platforms,”
Shopify
According to reports from the Wall Street Journal, the e-commerce business fired ten percent of its workforce, which equaled one thousand individuals.
In an internal memo that was obtained by the Wall Street Journal, the founder and chief executive of the company,
Tobi Lütke, explained to the staff that the layoffs were necessary because, as people begin shopping in stores again, the number of online orders that have made the company so profitable is beginning to slow.
Lyft
According to a report that was published in July by the Wall Street Journal, the ridesharing company terminated the employment of approximately sixty people, which represents two percent of the company’s total workforce.
According to a document that was acquired by the Wall Street Journal, Lyft’s vice president of fleet and worldwide operations, Cal Lankton, said that the company’s path to growing first-party rentals is lengthy, difficult, and fraught with substantial unpredictability.
Vimeo
According to Business Insider, the video-sharing site terminated the employment of around 72 workers in July, which represents six percent of the company’s workforce.
In an email to Vimeo staff members, Vimeo CEO Anjali Sud stated, “Our leadership team has spent a lot of time looking at scenarios for how to best position Vimeo with the appropriate amount of financial flexibility during this period.”
“Our leadership team has spent a lot of time looking at scenarios for how to best position Vimeo with the appropriate amount of financial flexibility during this period.”
“We have delayed recruiting, both at the beginning of the year as well as more recently, and we have been actively assessing and changing both our investments and our costs. In addition, we made a commitment to reevaluate our financial situation at the conclusion of each quarter based on what we had seen.”
GoPuff
According to Bloomberg, GoPuff terminated the employment of around three percent of its personnel, which amounted to more than 15,000 workers, in March. Just a few months later, the company terminated the employment of 10 percent of its remaining workforce.
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