Zoom, a well-known provider of video conferencing services that saw a surge in remote work during the Covid pandemic, is dismissing 1,300 employees.

About 15% of its staff will be impacted by the change, which comes as user growth and profits have recently slowed.

Boss Eric Yuan announced that, as the company focuses on making sure it can weather the slowdown, he and other leaders will also take significant pay cuts.

It is one of many tech companies that are making similar changes.

“As the world transitions to life post-pandemic, we are seeing that people and businesses continue to rely on Zoom,” Yuan wrote in a message to employees shared by the company.

“But the uncertainty of the global economy, and its effect on our customers, means we need to take a hard – yet important – look inward to reset ourselves so we can weather the economic environment, deliver for our customers and achieve Zoom’s long-term vision.”

Other industry titans like Salesforce and Amazon also made significant job cuts announcements, claiming that the pandemic-era business boom was coming to an end.

According to Layoffs.fyi, a website that tracks such announcements, nearly 100,000 workers have been laid off by more than 300 tech companies globally since the year’s beginning.

Particularly as competing tech companies improve their video offerings, Zoom has encountered difficulties.

In 2020, the company’s revenue more than tripled, and in 2021, it increased by about 55%. But in the previous year, the growth slowed to single digits, and its profits fell precipitously.

Since their peak in 2020, the company’s shares have fallen more than 80%.

In order to eliminate redundant roles and refocus on the company’s top priorities, Yuan said the cuts would have an impact on every area of the organization.

Zoom stated that it anticipated the restructuring to cost $50 million to $68 million, with the affected staff receiving 16 weeks of pay, health insurance, and other support.

Yuan announced that he would also eliminate his bonus and reduce his pay in the upcoming fiscal year by 98%. He also said that other executives on the executive leadership team would lose their bonuses and see a 20% reduction in base pay.

“We worked tirelessly.. but we also made mistakes. 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 said.

“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.”

Following the announcement, the company’s shares increased by more than 8%.

(Adapted from BusinessToday.in)

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