Snap Plans To Lay Off 20% of Staff
Samson Amore is a reporter for dot.LA. He holds a degree in journalism from Emerson College. Send tips or pitches to samsonamore@dot.la and find him on Twitter @Samsonamore.
Snap Inc. plans to lay off about 20% of its 6,400-strong workforce, according to the company.
In May, CEO Evan Spiegel said the social media giant would slow hiring, and warned revenue growth would continue to stall. At the time, Spiegel blamed the app’s downturn on everything from the conflict in Ukraine to inflation and supply chain shortages.
Most of the cuts will affect Snap’s team working on games and mini-apps for Snapchat as well as the team running Zenly, a social-mapping app the company bought in 2017. The hardware division, which works on Snap’s augmented reality goggles and the now-defunct Pixy camera drone, is also expected to face steep cuts. The ad sales division is also “being restructured," and Snap will phase out its Yellow accelerator investment program.
In an investor letter published last month, Snap admitted “demand growth on our advertising platform has slowed significantly,” and noted “we have observed reduced marketing spending and lower bids.”
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The layoffs follow Snap’s second quarter earnings report, which saw daily active Snapchat users increase by 18% annually – but mostly outside the U.S., as it failed to hit expectations in North America, where daily users grew by only 4% in that time. Snapchat’s user base of roughly 347 million remains on par with rivals such as Twitter, but that hasn’t prevented Snap from its mounting losses. The social camera company missed earnings expectations, and posted a net loss of $422 million on revenues of $1.1 billion last quarter.
This is a developing story. Have a tip? Contact Samson Amore securely on Signal at 401.287.5543 or at samsonamore@dot.LA.- Snap Ends Yellow Accelerator, Cuts Originals As It Scales Back - dot ... ›
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Samson Amore is a reporter for dot.LA. He holds a degree in journalism from Emerson College. Send tips or pitches to samsonamore@dot.la and find him on Twitter @Samsonamore.
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