Snap to lay off one-fifth of its employees

Snap is preparing to lay off a fifth of its employees. Times are tough for everyone, spending needs to be cut.

To say times are tough is an understatement for some. This manifests itself at all levels, from the smallest to the largest companies. The tech and web giants are paying the price, too. Layoffs have been on the rise in recent years. Today, Snap is preparing to cut its payroll significantly.

Snap to lay off one-fifth of its employees

According to rumors, Snap is preparing to lay off about 20% of its employees. The company, which currently has more than 6,400 employees, has just started parting ways with some of them, according to The Verge. Contacted by Engadget, the company declined to comment on the topic.

Times are tough for everyone

In particular, there will be layoffs in the company’s hardware division, which recently stopped development of the Pixy selfie drone. The report also says the group that has been working on tools to help developers create games and widgets on Snapchat will be hardest hit by the layoffs. The social app Zenly, which Snap acquired in 2017 and which operated independently, should also be hit hard. According to the same source, the advertising sales department will be restructured.

Costs need to be reduced

It’s been a tough year for Snap, whose shares have fallen 80% since January as the global economy crashed, with many tech companies feeling the effects. Snap said it will look to cut costs while cutting new hires. The company reported rather weak financial results for the second quarter, which led to a decrease in the value of its shares by 40%.

However, one of the highlights for Snap recently has been Snapchat+’s $4/month subscription service, which offers early access to some new features like the ability to revisit history or pin a friend to the top of the conversation history. Within the first month, more than a million users have already subscribed.