Consumer Inflation Sentiment October 2023

Snapchat Parent to Cut 10% of Global Staff

Snap has become the latest tech company to cut staff as it chases profitability.

The Snapchat parent company announced in a Securities and Exchange Commission (SEC) filing Monday (Feb. 5) that it plans to lay off 10% of its full-time workforce. 

“In order to best position our business to execute on our highest priorities, and to ensure we have the capacity to invest incrementally to support our growth over time, we have made the difficult decision to restructure our team,” the filing said.

The social media company had 5,367 employees, per its most recent earnings report, which means the layoffs would impact just under 540 workers.

These cuts follow the 20% reduction in staff — affecting close to 1,300 workers — in 2022. Snap also engaged in a small round of layoffs last year, cutting 20 product managers.

Monday’s announcement comes in the wake of a weekend report by Business Insider warning of the layoffs.

According to the report, Snap CEO Evan Spiegel recently published a memo trying to rally staff, stressing a sense of “urgency” at the company as it competes with Apple and Meta in the augmented reality space.

“We need our business to be strong enough and profitable enough to deliver the future of computing in augmented reality,” Spiegel wrote in the memo, entitled “Social media is dead. Long live Snapchat!”

The report also noted many staff members saw the memo as a sign that more changes were coming. One of the sources says employees have been “on pins and needles” about the threat of job cuts recently.

Last month saw companies in the tech industry cut 15,806 jobs, the highest number of layoffs made in that sector since May of last year.

Those cuts, however, were overshadowed by layoffs made in the financial world, which let go of 23,238 workers, the biggest series of cuts since 2018.

Among the companies that announced they were restructuring in January were spend management firm Brex, which let go of 20% of its workforce; enterprise application software provider SAP, which said 8,000 workers will be either retrained or leave the firm; and Amazon, which said it was cutting the staff of Buy with Prime operation by less than 5% as part of its ongoing restructuring.