Thousands laid off at PayPal, Block, others
PayPal informed its employees of a significant workforce reduction on Tuesday, with approximately 2,500 employees, constituting 9% of the company’s workforce, set to be laid off.
This move follows a similar round of layoffs last year when the San Jose-based digital payments company cut 2,000 roles.
CEO Alex Chriss, who assumed the role in September, wrote in a letter to the staff that the measures were essential to “right-size” the company. The layoffs will be executed through both direct cuts and the elimination of open positions.
Those impacted by the restructuring will be notified by the end of the week, as confirmed by a letter verified by Bloomberg News. As of now, no official filings have been submitted to state officials regarding these layoffs.
Chriss emphasized that these cuts are aimed at enabling the company to operate with the necessary agility to meet customer needs. “At the same time, we will continue to invest in areas of the business we believe will create and accelerate growth,” he wrote.
The PayPal announcement coincided with Block Founder and CEO Jack Dorsey following through on his commitment to widespread job cuts at the finance and payments-focused tech firm, reportedly letting go of close to 1,000 people.
While Dorsey did not confirm the specific number of layoffs, a note viewed by Business Insider revealed that he told staff that Block was parting ways with “a large number of our teammates.”
In December, Block had previously laid off staff at the music streaming service Tidal. Dorsey has expressed his intention to cap the company’s workforce, formerly known as Square, citing a misalignment between economic growth and workforce expansion.
On Tuesday, he added that operations were “getting leaner.”
This latest round of layoffs affected Block workers at Cash App, Foundational and Square. Although employees had anticipated some layoffs, they did not expect a 10% reduction in the company’s workforce in a single day.
Dorsey explained in his note Tuesday, “We decided it would be better to do it at once rather than arbitrarily space them out, which didn’t seem fair to the individuals or to the company. When we know we need to take an action, we want to take it immediately, rather than let things linger on forever.”
Another company joining the list of layoffs on Tuesday was Aurora Solar, a San Francisco software startup. The company laid off 20% of its staff, approximately 500 people, as reported by TechCrunch.
In a statement, Aurora Solar attributed the decision to “macroeconomic challenges” in the solar industry, including higher interest rates and the impact of NEM 3.0, or the net billing tariff, in California.
Yahoo-owned technology publisher TechCrunch, incidentally, also initiated a workforce reduction this week, letting go of eight staff members in its subscription product division, as confirmed in an internal memo obtained by Adweek.
“We’ll be sunsetting the TechCrunch+ subscription product in the coming weeks and will refocus our talented writers and editors on strengthening our core product,” editor-in-chief Connie Loizos told staff. “Building around two businesses hasn’t allowed us to focus where we can win.”