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Zoom is laying off approximately 1,300 employees, reducing its workforce by around 15 percent. It's the latest company to be hit by widespread Big Tech layoffs, joining a slew of others such as Microsoft, Amazon, Meta, and PayPal.
The mass layoff was announced in a blog post from Zoom founder and CEO Eric Yuan on Tuesday, who stated impacted employees in the U.S. would be notified via email within 30 minutes of its publication. Employees outside the U.S. who are being let go will be notified according to their local laws.
"For those Zoomies waking up to this news or reading this after normal work hours, I am sorry you are finding out this way but we felt it was best to notify all impacted Zoomies as soon as possible," said Yuan.
Tech workers being abruptly let go via email has become an unfortunately common scenario over the past several months, with a different company announcing a mass layoff seemingly every week. Yuan did state that departing Zoom employees will have the option to do a one-on-one check-in with a company leader if they so choose, but it probably won't lessen the sting very much.
Full-time Zoom employees in the U.S. who are being let go will be given up to 16 weeks' salary and healthcare coverage, as well as their annual bonus, stock option vesting for six months, and access to services designed to help them find new employment. International employees will receive similar benefits, again accounting for local requirements.
Zoom exploded in popularity at the start of the COVID-19 pandemic, with millions of people turning to the video conferencing tool as businesses began operating remotely and countries went into lockdown. Yuan noted that Zoom grew three times its size in just two years, bringing on new staff to meet the unexpected influx of customers.
However, as lockdowns lifted and workers began shifting back into the office, Zoom's growth and revenue has slowed. This combined with increasing expenses has seen the company's net profit drop significantly. As of November, Zoom's share value had plummeted by over 90 percent since its peak in Oct. 2022.
"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," Yuan wrote in Tuesday's blog post.
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Yuan also announced that he would be taking a temporary pay cut this fiscal year, reducing his salary by 98 percent and not taking a bonus. Similarly, the executive leadership team will have their salaries reduced by 20 percent this fiscal year, and also won't be getting bonuses.
"As the CEO and founder of Zoom, I am accountable for these mistakes and the actions we take today — and I want to show accountability not just in words but in my own actions," said Yuan.
Zoom's next earnings call is scheduled for the end of this month, when the company will release its financial results for the full 2023 fiscal year.
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