In a new round of layoffs, Snap Inc. has announced that the company is set to reduce 10% of its workforce.
According to a report by CNBC, this will affect around 500 employees of the social media giant. In the past, the company has executed multiple rounds of layoffs since 2022, most recently in November last year.
“We are reorganizing our team to reduce hierarchy and promote in-person collaboration. We are focused on supporting our departing team members,” a spokesperson of Snap Inc. told CNBC.
The social media giant is the latest tech company that is continuing the trend of downsizing in 2024. In January alone, around 24,000 tech workers lost their jobs. Snap CEO, Evan Spiegel, appeared before the Senate Judiciary Committee last week, one of the several CEOs who appeared before the committee over teen safety.
Amid the job cuts in the tech industry, Snap also had to shelve many of its projects, including its Pixy drone camera. They recalled the Pixy drone camera just after four months in the market due to fire risk.
The company posted a 5% year-on-year growth in Q3. It also added more users but the growth in the US is pretty stagnant. Most of its growth comes from the rest of the world, particularly India.
The problem for them is that the average revenue per user is down from what it had been in the past. For its income, Snapchat relies heavily on North American users. In that segment, the company is not seeing an increase in numbers. They are working to reduce its infrastructure spending, through revised deals with Google and Amazon.
All in all, Snap Inc. is struggling. For how long, we don’t know.