Zoom is the latest tech company to be hit by mass layoffs as 1,300 jobs are set to get cut.
On Tuesday, the company said it was laying off nearly 15% of its workforce, as demand for its video conferencing services slows with the waning of the pandemic.
While announcing the layoffs, Chief Executive Officer Eric Yuan said he would take a pay cut of 98% for the coming fiscal year and forego his bonus.
‘We worked tirelessly… but we also made mistakes. We didn’t take as much time as we should have to thoroughly analyze our teams or assess if we were growing sustainably, toward the highest priorities,’ said Yuan.
The video conferencing software maker also said that its executive leadership team will reduce their base salary by 20% in the same period.
Departing employees will receive 16 weeks of salary, healthcare coverage and a bonus for the year, Yuan said.
Zoom will incur about $50 million to $68 million in charges related to the layoffs, according to a regulatory filing on Tuesday.
The company said a substantial part of it will be spent in the first quarter of fiscal 2024.
Zoom, which became a household name during lockdowns due to the popularity of its video-conferencing tools, has seen its revenue growth slow.
After a more than four-fold jump in revenue and a nine-fold surge in profit increase in 2021, the company’s profit is estimated to have fallen 38% in 2022.
Zoom had bumped up hiring during the pandemic to meet surging demand, but now joins US companies in reining in costs to brace for a potential recession.
A number of US companies from Goldman Sachs to Google-parent, Alphabet have laid off thousands this year to ride out a demand downturn wrought by high inflation and rising interest rates.
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