After an unfathomable boom at the start of the pandemic, Zoom made the decision to cut 15% of its workforce, or 1,300 people.
“The uncertainty of the global economy and its effects on our customers means that we need to look inward to reset so that we can navigate the economic environment,” CEO Eric Yuan wrote in an article by blog addressed to “Zooms”.
In the first 24 months of the pandemic, Zoom tripled its staff to handle a sudden surge in demand, when the company saw five straight quarters of triple-digit year-over-year growth. This growth naturally slowed, but Zoom remained on a steady upward trajectory. When the 12-year-old company last released its quarterly results in November, its revenue had risen 5% year-on-year to $1.1 billion; although online revenue fell 9%, business revenue increased 20% to $614.3 million. Zoom also reported free cash flow of $272.6 million.
“As CEO and Founder of Zoom, I am responsible for these mistakes and the actions we take today – and I want to show my responsibility not just in words but in my own actions,” Yuan wrote. He will cut his salary by 98% and decline his bonus; he said the executive leadership would cut their salaries by 20% and also waive their bonuses.
According to Forbes, Yuan’s net worth is $3.9 billion.
Affected employees will receive up to 16 weeks of pay and health coverage, plus their bonus from last year. They will also have access to stock option vesting and services to help them find new jobs.
Update, 2:27 PM ET, 2/7/23: A previous version of the article said the company spent $14.7 billion to acquire the Five9 cloud call center. The deal did not go through.
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