Social media giant Snap lays off 20% of staff

The social media tech company Snap, whose core product Snapchat remains a fixture among the Gen Z and Millennial set, has laid off 20% of its staff due to “lower revenue growth.”

In an email sent Wednesday to staff, CEO Evan Spiegel emphasized that the company “must reduce our cost structure to avoid incurring significant ongoing losses.” The news of the layoffs was leaked Tuesday to the Verge.

“Our forward-looking revenue visibility remains limited, and our current year-over-year QTD revenue growth of 8% is well below what we were expecting earlier this year,” Spiegel said.

Snap’s stock has plummeted by nearly 77% since the start of 2022, being afflicted by the same economic headwinds as the rest of the tech industry. But, like its competitor Meta, Snap is also getting hit hard by the emergence of TikTok and BeReal (which it recently launched a copy of) as well as suffering from Apple’s push to privacy affecting its advertising business. (Snap’s stock, as of Wednesday morning, rose nearly 10% in light of this news.)

As a result, the company is undergoing mass restructuring — cutting services like Snap Originals, its video content service, Snap Games, its on-platform gaming, and Pixy, the company’s drone camera.

Laid-off employees will receive four months of “compensation replacement,” as well as financial assistance for COBRA.

It’s one of the first large social media platforms to conduct mass layoffs this year. Late last week, TikTok laid off a small number of advertising staffers, and in July, Twitter laid off 30% of its recruiting team.

Snapchat, headquartered in Santa Monica, found its roots in Stanford. Its co-founder and chief technology officer, Robert Murphy, was born and raised in Berkeley.

The company has about 6,400 employees, the Verge reports.

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