Snap can’t seem to stop cutting employees from its workforce. When 2018 began, the company dropped dozens of employees from the content division. Then, earlier this month, a report came out that a significant number of engineers were losing their jobs. Revenue increased late last year but profitability is still far off, so it would seem Snap wants to cut stuff to reduce costs.
The company plans on letting go of around 100 employees from the advertising team in the latest round of layoffs, according to Bloomberg.
It should be the final step in a lengthy restructuring process. The company behind Snapchat explains that it wants smaller teams to enhance collaboration between them. Snap has asked employees at offices in New York City and London to relocate to the Los Angeles headquarters as well.
Here’s a statement from the company:
“Late last year we asked senior leaders across Snap to look closely at their teams to ensure they had the right resources and organizations to support their missions. Tighter integration and closer collaboration between our teams is a critically component to sustainabily growing our business.”
More layoffs aren’t exactly surprising, even if the reason for them is understandable. Snap can’t turn a profit and is currently facing pushback from users over the latest update for its app. If there’s no steady growth in users, advertisers will stay hesitant to spend money.
Releasing a pair of smart glasses appeared to be a wise move at first, but then the Spectacles turned out to be a tech fad that no one cares about anymore. The company can’t seem to find a way to win back excitement from existing users while attracting new ones.
By the month, Snapchat loses users to Instagram. The Facebook-owned service has implemented several of Snapchat’s features including stories, stickers, and filters.
Snap is rebuilding its advertising model despite the layoffs. Its overhauled app is made to separate social and media, letting users interact with each other away from a stream of publisher-made content. When Snap’s Q1 2018 financial results are shared in May, we’ll know exactly how that’s paying off.