US Snap Also Lays Off 10% of Employees... Tech Industry Downsizing Continues

Global Workforce Reduced by 529 Employees... Stock Price Declines

Snap, the operator of the social networking service (SNS) Snapchat, will lay off 10% of its global workforce. Tech industry layoffs have been continuing since the beginning of the year.

On the 5th (local time), Snap announced plans to cut 529 employees, equivalent to 10% of its staff, to strengthen in-person collaboration. This is an additional layoff following the restructuring of 20% of its total workforce in 2022 and 3% in 2023.

The company expects the layoffs to incur pre-tax costs of $55 million to $75 million (approximately 73 billion to 100 billion KRW).

Snap stated, "We are reorganizing the company to reduce job levels and strengthen face-to-face collaboration," adding, "We are focusing on supporting employees who are leaving the company."

Snap's stock price is currently down more than 1.8% intraday on the New York Stock Exchange.

The US tech industry, which underwent large-scale layoffs last year, continues to carry out layoffs from the beginning of this year. In January alone, 24,000 tech workers lost their jobs. This month, cybersecurity company Okta announced it would cut 400 employees, or 7% of its workforce, and video conferencing platform Zoom said it would reduce 150 employees, or 2% of its staff.

Big tech companies are focusing on improving efficiency through layoffs. Meta, the parent company of Facebook, laid off about 21,000 employees last year and reorganized its corporate structure to focus on core businesses. As a result, its stock price nearly tripled last year. On the 1st, Meta announced its first-ever dividend since its founding and a $50 billion (approximately 66.8 trillion KRW) share buyback plan along with its earnings report. On the following day, the 2nd, Meta's stock price surged 20.3% in a single day.