American communications technology company Zoom has announced plans to trim workforce by 15% which is about 1,300 employees as it navigates the current economic downturn.
The company’s CEO Eric Yuan revealed this via a message on the company’s website, stating that the layoffs were necessary as the company looks for ways to stay afloat, owing to the fact that the world has transitioned to live post-pandemic.
He wrote,
“Over the past few years, Zoom has become an indispensable source of connection for businesses and individuals as well as a globally recognized brand. Whether you have been at Zoom since the beginning or joined us more recently, you’ve played an important role in our evolution, and that makes today’s announcement particularly difficult.
“We have made the tough but necessary decision to reduce our team by approximately 15% and say goodbye to around 1,3000 hardworking talented colleagues. I know this is a difficult message to hear, and certainly not one I ever wanted to deliver”.
The CEO further acknowledged that he is accountable for the mistakes, hence he wants to show accountability not just in words but in actions. To that end, he announced that he will reduce his salary for the coming fiscal year by 98% and also forgo his FY23 corporate Bonus.
Also, members of his executive leadership team will reduce their base salaries by 20% for the coming Fiscal year, while also forfeiting their FY23 corporate Bonuses.
Zoom laid-off employees will be supported with the following; Up to 16 weeks salary and healthcare coverage, payment of earned FY23 annual bonus based on company performance, outplacement services that include one on one coaching, workshops, RSU, and stock option vesting for 6 months for its employees and through August 9, 2022, for non-U.S employees, networking groups and more.
Investors king understands that during the peak of the Covid-19 pandemic, Zoom witnessed a massive usage of its platform because most firms had to resort to the remote way of work. This saw the company hire a lot of team members to support the quick rise of users on the platform and their evolving needs.
As the world transitions to life post-pandemic, which has seen many employers/employees return to the workplace, Zoom has witnessed a low usage compared to the pandemic era, hence the need for the company to trim its workforce.