BuzzFeed to Lay Off 15% of Workforce
BuzzFeed is laying off 15 percent of its workforce, about 215 people, sources tell The Hollywood Reporter. CEO Jonah Peretti on Wednesday sent a memo to staffers with the subject line “Difficult Changes” in which he explained that efforts to diversify revenue weren’t enough to help the company achieve profitability.
“Unfortunately, revenue growth by itself isn’t enough to be successful in the long run,” he wrote. “The restructuring we are undertaking will reduce our costs and improve our operating model so we can thrive and control our destiny, without ever need to raise funding again.” The cuts, expected to be company-wide, are set to take place next week.
The staff reductions will give BuzzFeed a faster path to profitability, a spokesperson said. “Rumors started flying” about the layoffs on Tuesday in the company’s New York and Washington, D.C.-based offices. “Lots of people are talking about it,” said an employee on the basis of anonymity. About 1,450 staffers work at BuzzFeed.
Across the industry, online publishers have struggled to sustain fast growth in digital advertising sales and meet the high expectations of their investors, as they run up against the dominance of tech titans such as Alphabet Inc.’s Google and Facebook Inc. Many firms are now considering deals with rivals to achieve the scale they believe is necessary to compete.
There are signs of growing pressure in the industry.
The online publisher Mic recently agreed to sell itself to women-focused publisher Bustle Digital Group for about $5 million. Refinery29, the lifestyle-focused publisher that targets millennial women, laid off 10% of its workforce last fall.
BuzzFeed, for its part, has struggled at times to meet its own ambitious revenue targets and has scaled back its expectations. In 2018, the company basically hit its revenue target of around $300 million, the people familiar with the situation said.