Snap, parent of Snapchat, said to today it plans to reduce its global headcount of full time employees by about 10%, or more than 500 people, in its latest round of staff cuts amid copious tech sector layoffs from Amazon to Google to Microsoft.
“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 an SEC filing.
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The company estimated the move 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 majority of these costs are expected to be incurred during the first quarter of 2024.
Snap said that potential position eliminations in each country are subject to local law and consultation requirements, which could extend the process into the second quarter of 2024 or beyond in certain countries.
The charges that we expect to incur are subject to a number of assumptions, including local law requirements in various jurisdictions, and actual expenses may differ materially from the estimates disclosed above.
Snap will report fourth quarter earnings tomorrow after market close. The company led by Evan Spiegel laid off about 1,600 workers, or about 20% of its workforce in August of 2022.
Some 122 companies across tech have laid off nearly 32,000 people so far in 2024, according to the website Layoffs.com. Last year, 1,190 companies laid off nearly 263,000. The sector thrived during Covid and added staff but had reckoning as the pandemic eased, exacerbated by record high interest rates.
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