The nightmare continues in the tech sector as another company conducts layoffs. Amazon Prime Video and Twitch were the latest to be hit, and now Discord is also shrinking its workforce which affects over 100 employees.
Discord Job Cuts
The company announced that it would be laying off 17% of its staff, which is equivalent to about 170 employees. There are several impacted departments, which was made known during an internal meeting that all employees were supposed to attend.
Just like the others in the tech industry, Discord took on more work and hired more employees since 2020 as the pandemic caused a surge in usage for various apps and sites. That, however, has since gone down and companies are suffering because of it.
CEO Jason Citron said in a memo that the workforce has grown by five times since the first year of the pandemic, taking on more projects which resulted in inefficiency. The job cuts are to ensure that the company can operate better in the long term.
Discord has already conducted layoffs back in August which affected a smaller number of employees at just 4%. It's likely that the user numbers have not reached the level they previously were, forcing the company to lay off even more.
Before the layoffs, The Verge reports that the company has raised a total of $1 billion in funding, and has over $700 million in cash on this balance sheet. Discord also turned down an acquisition offer from Microsoft, which was priced at $12 billion.
"We are increasingly clear on the need to sharpen our focus and improve the way we work together to bring more agility to our organization," said the CEO, adding that while difficult, the executive believes that it will put the company in the "best position to continue building a strong and profitable business."
Employees will receive a severance package including five months of salary, plus an additional week for every full year at Discord, along with three months of outplacement services, access to Modern Health until the end of 2024, and more.
Other Recent Layoffs
Amazon-owned Twitch has also suffered job cuts lately, affecting even more workers than Discord with over 500 employees being laid off. Twitch CEO Dan Clancy has already confirmed the news, saying that it was prompted by the company's aim to cut costs.
It's not the only Amazon business that has been affected. Amazon Prime Video and MGM Studios will both undergo workforce reductions as well. The company states that the decision was for the company to "prioritize our investments for the long-term success of our business."
As per Reuters, employees from the Americas have already been informed on Wednesday, while staff from other countries will hear about their job situations by the end of the week. This is an addition to the already massive number of layoffs that Amazon implemented.
Back in 2023, there were more than 27,000 people who lost their jobs. The reason was the same as Discord, wherein Amazon hired more employees to accommodate the surge of users during the pandemic.
