The parent company of Snapchat — Snap — is laying off about 10 percent of its workforce as layoffs continue to stalk the tech sector.
Snap announced the cut Monday, which will impact more than 500 employees, according to TechCrunch, which noted that as of last year’s third quarter, Snap had 5,367 workers.
“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 company said in a Securities and Exchange Commission filing.
“As a result, we currently estimate that we will incur pre-tax charges in the range of $55 million to $75 million, primarily consisting of severance and related costs, and other charges, of which $45 million to $55 million are expected to be future cash expenditures,” the filing said.
“We are reorganizing our team to reduce hierarchy and promote in-person collaboration,” a Snap representative said.
Snap made layoffs last year after a 20 percent workforce cut in 2022.
“The layoffs don’t bode well for the state of Snap’s business ahead of its Q4 2023 earnings,” principal analyst Jasmine Enberg said.
Snap is not alone. The chill wind of layoffs is blowing through Google as well, according to The New York Times.
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Last year, Google CEO Sundar Pichai said the company would cut 12,000 jobs, about 6 percent of its workforce.
The cutting continues, with more than 1,000 jobs eliminated this year.
Biden boom? Stop lying? So many layoffs in tech industry
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Alphabet, the parent of Google, has said it is trying to save money in other parts of its business to invest in its artificial intelligence operations.
“The reality is that to create the capacity for this investment, we have to make tough choices,” Pichai wrote Google workers on Jan. 17.
In some parts of the company, “this means reorganizing and, in some cases, eliminating roles,” he wrote, noting that more cuts could take place throughout the year.
Last year, tech companies sliced more than 260,000 workers, according to The Washington Post, citing the website Layoffs.fyi.
This year, Google, Amazon, Microsoft, Discord, Salesforce and eBay have all made layoffs.
PayPal added itself to the list, advising employees it plans to cut 2,500 people — about 9 percent of its workforce
