Zoom to layoff 15% of employees, CEO to take massive 98% pay cut
Zoom, the tech company that shot into the spotlight during the Covid-19 pandemic as many companies went remote, announced plans on Tuesday to cut 1,300 employees from its workforce.
In a message shared Tuesday with Zoom employees, CEO Eric Yuan wrote the company needs to adapt to the “uncertainty of the global economy” and “its effect on our customers.”
Shares of Zoom stock were up more than 7% in afternoon trading.
“We worked tirelessly and made Zoom better for our customers and users. But we also made mistakes,” Yuan wrote in a Zoom blog. “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.”
The layoffs account for 15% of the company's workforce, Yuan said.
The company ramped up staffing during the pandemic, the CEO said, when businesses became increasingly reliant on its service as people worked from home.
Zoom grew three times in size within 24 months to manage demand.
He also said businesses continue to depend on its service post-pandemic but that adjustments are needed.
Yuan said he was also lowering his salary for the coming fiscal year by 98% and foregoing his 2023 corporate bonus, saying he was accountable for mistakes made at the San Jose, California-based company and the actions being taken.
Yuan's executive leadership team is also reducing their base salaries by 20% for the coming fiscal year and forfeiting their 2023 corporate bonuses.
What big layoffs at tech companies mean: Big tech companies face mass layoffs yet still maintain expanded workforces
Layoffs join Google, Amazon, Spotify, Microsoft and more
Zoom becomes the latest tech companies to lay off scores of workers.
Google's parent company Alphabet recently laid off 12,000 workers, equivalent to 12% of its workforce. Meta cut an even bigger share of its staff. Even IBM, which has been in business for 111 years, is cutting thousands of jobs.
What is Google Bard? Here's what you need to know about company's new AI experience.
Since the start of the year, 297 tech companies laid off nearly 95,000 workers, according to data compiled by Layoffs.fyi, a website that's been tracking tech layoffs since March 2020. If that rate continues, the industry could cut more than 900,000 jobs in 2023. That's nearly six times the total for the industry in 2022, according to the site.
More: Latest tech sector layoff looks ugly. But it may not be as bad as you think.
Contributing: Associated Press, Elisabeth Buchwald and Javier Zarracin
Natalie Neysa Alund covers trending news for USA TODAY. Reach her at firstname.lastname@example.org and follow her on Twitter @nataliealund.
This article originally appeared on USA TODAY: Zoom layoffs hit 1,300 employees, CEO Eric Yuan slashes salary