Snapchat is the latest silicon valley tech company that’s laying off employees – citing the economic headwinds like any other company.
While its managers are estimating the scope of layoffs across the departments, it’s believed that Snapchat is gearing up for this decision more due to the poor Q2 earnings it released recently. Though the platform is a hit among youngsters, it’s struggling to build a proper revenue model.
Snapchat is Firing Employees
Though Snapchat seems to be a profitable company in the social media ecosystem, it’s one of the many cash-burning platforms spending heavily to stay afloat. The platform has been releasing new features and security controls to attract users, yet it’s struggling.
And this eventually led to the grand decision of firing employees to cut costs – said two people familiar with the matter. Further, a negative result from the Q2 earnings report triggered the decision too, which also sent its stock price to a near-all-time low.
While it didn’t make any forecast for the Q3, the company’s managers are estimating the scope of layoffs across the departments, noted The Verge. Snap has over 6,000 employees working globally.
One of the biggest hits Snap faced in recent times is from Apple, with its “Ask App Not to Track” prompt – which most users set to Yes – thus blocking Snap from collecting users’ data. This affected Snap’s targeted ad business so much, similar to Meta’s.
And next is the ongoing economic conditions, which are forcing many companies to find a way – mostly by laying off employees – to save costs and stay afloat. And Snap was one among them! The company has recorded only one profitable quarter since 2017 and laid off a few employees in 2018.
Besides Snap, we have seen Meta, Uber, Google, OpenSea, Apple, etc are either laying off employees or slowing the new hires to save costs.