Snap states that significant business restructuring is reaching and ensures it's missing 20% of staff
September 01, 2022: -Snap authorized reports it will slice 20% of its over 6,000-person workforce and said it would scrap a few projects, which include its Pixy photo-taking drone and its lineup of Snap Originals tip shows.
On Tuesday, Evan Spiegel, Snap’s CEO, announced the moves in a memo and told employees the company needs to restructure its business to deal with its economic challenges. He expressed the party’s current yearly revenue growth rate for the quarter of 8% “is well below what we were predicting earlier this year.”
“While we have built substantial capital reserves and have made extensive efforts to evade reductions in the size of our team by consolidating spend in other areas, we must confront the consequences of our lower revenue growth and adapt to the market environment,” Spiegel added. “We are restructuring our business to focus on our three strategic priorities: community growth, revenue growth, and augmented reality.”
Additional projects the company nuked include its Snap Minis third-party apps and Snap Games. Spiegel said Snap is also starting the “process of winding down” its Zenly map product and Voisey music feature, inherited through acquisitions.
Snap has announced Jerry Hunter from senior vice president of engineering to chief operating officer. Hunter will continue leading Snap’s engineering unit, Spiegel said.
The company hired Ronan Harris, Google’s vice president and managing director of the U.K. and Ireland, to be its president of Europe, the Middle East, and Africa, a new position. Harris will join Snap’s executive team.
Spiegel said Snap is currently searching for presidents of the company’s Asia-Pacific and Americas regions, also two new roles.
“Changes of this magnitude are never easy, and we must act decisively to meet this moment as a team,” Spiegel said. “I am proud of the strength and resilience of our team as we have navigated the myriad challenges of growing our business in a positively competitive enterprise during insecure and unprecedented times.”
In July, Snap shares cratered over 25% after the company reported second-quarter results that skipped the top and bottom lines and said it would not guide its recent quarter.
The company said at the time that it planned slow its hiring and manage expense growth rates.
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