In a move echoing recent trends in the tech industry, Snapchat has disclosed plans to lay off approximately 10% of its global workforce, amounting to around 530 employees.
The California-based company, known for its popular multimedia messaging app, cited restructuring efforts as the primary driver behind the decision, as reported in its regulatory filing.
The majority of the job cuts are expected to occur during the first quarter of the year, according to sources cited by Sky News. The filing further revealed that Snapchat anticipates spending up to $75 million on severance benefits and associated expenses as part of the restructuring process.
With a workforce exceeding 5,300 employees worldwide, Snapchat's decision to downsize marks a significant adjustment for the company. Among its global workforce, approximately 500 employees are based in the United Kingdom (UK), raising questions about the potential impact of the layoffs in that region.
A spokesperson for Snap acknowledged the reorganization efforts, emphasizing a focus on reducing hierarchy and fostering in-person collaboration within the team. The spokesperson also expressed gratitude for the contributions of departing employees, highlighting their efforts and dedication to the company.
Despite the restructuring, Snapchat remains a formidable presence in the social media landscape, boasting an average daily user base of 406 million, according to data from Demand Sage. However, the announcement of job losses aligns with a broader trend observed across the tech sector, with companies like Microsoft and eBay also announcing layoffs in recent times.
Meta, the parent company of social media giants Facebook and Instagram, made headlines last year with its announcement of 10,000 job redundancies. In the wake of Snapchat's announcement, shares in the company experienced a 4% decline on Monday, underscoring investor concerns regarding the implications of the restructuring.
Snapchat is scheduled to unveil its fourth-quarter results on Tuesday, with stakeholders eagerly anticipating insights into the company's financial performance amid these strategic adjustments.