Snap, the company that owns Snapchat, the parent company of Snapchat application for messaging, announced on Monday it plans to eliminate more than 500 employees. as well as other tech companies, in the series of costs-reducing measures.
The reductions in employment amount to 10 percent of its total workforce. The majority of these will happen in the first quarter of 2024.
“We have taken the difficult decision to change the structure of our workforce,” the company said in a filing with the Securities and Exchange Commission in which it stated that it would accept pretax expenses of between $55 million and $75 million, mostly for separation and related costs.
Amazon, Google and Microsoft have announced layoffs in the coming year following tens of thousands of layoffs in the field last year.
Snap was forced to lay off a small quantity of workers on the Friday. the Business Insider said.
The company is scheduled to release its earnings report on Tuesday. The cost-cutting efforts of other companies have boosted the stock price. Snap shares were trading around 2 percent lower when the market began trading on Monday.
As with other social media companies that rely upon advertising Snap is experiencing a difficult few years. The changes made by Apple on its privacy policies in 2021 caused it to be more difficult for advertisers to follow users. This affected Snap and had an huge impact on Meta who owns Facebook as well as Instagram.
Snapchat is home to greater than 400 million active daily users, reported an increase in revenue during the initial two quarters this year. It also experienced just five percent increase in the most recent quarter, that ended September. 30.
in 2022 Snap reduced 20 % of the workforce of 1,300 employees and halted at least six of its products. The company laid off more than 20 managers of its product in November, and in September, it shut down the division that sold Augmented Reality products to companies and laid off 170 employees.