Social media platform Snapchat to layoff over 500 employees

Layoff 2024: Social media platform Snapchat's parent Snap has announced the layoff of 10% of its workforce affecting 529 employees, in a fresh round of job cuts. As per a regulatory filing, the Snapchat parent is expecting to incur pre-tax charges, mainly comprising severance and associated expenses, as well as other charges, with an estimated range of $55 million to $75 million.

Snapchat Layoff 2024: Severance Expense

Out of this estimated range, Snap has estimated $45 million to $55 million to be future cash outlays. The firm further added in the regulatory filing that the primary timeframe for incurring the majority of these costs is expected to be the first quarter of 2024.

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“On February 5, 2024, we announced a plan to reduce our global headcount by approximately 10% of our global full-time employees. In order to best position our business to execute on our highest priorities, and to ensure we have the capacity to invest incrementally to support our growth over time, we have made the difficult decision to restructure our team.," Snap said in a filing with the SEC.

Tech Layoffs

According to Layoffs.fyi some 32,000 tech workers have lost their jobs in 2024 so far. Bloomberg quoted Founder of Layoffs.fyi Roger Lee and said that most of the companies are working to correct the massive hiring that happened during the pandemic time.

"Tech companies are still trying to correct for their over-hiring during the pandemic surge, given that the high interest-rate environment and tech downturn have both lasted longer than initially expected," Layoffs.fyi founder Roger Lee wrote in an email to Bloomberg.

As per Lee there have been two main waves of job cuts in recent years. The "early Covid" spike, from the first to second quarters of 2020, and the "interest rate hike" effect, which has been going on since the second quarter of 2022. "This year's layoffs are typically smaller and more targeted than the layoffs a year ago," Lee said.

Despite this, Lee also noted that hiring in AI field has increased as companies are shifting resources to focus on AI talent. According to an analysis by CompTIA, which tracks employment trends in the tech industry, job postings in "artificial intelligence or requiring AI skill increased by about 2,000 from December to January, to 17,479."