“We are reducing the size of our team by 19%. This was the single most difficult decision I have had to make since Affirm’s founding, but I believe it is the right one. I take full responsibility for it and the actions that led us to this point,” founder & chief executive officer Max Levchin wrote in a message.
Levchin further said that during the early part of the pandemic, the company “consciously hired ahead of the revenue required to support the size of the team”, with revenue growth justifying the strategy.
Moreover, the fintech firm also mentioned that the company will be sunsetting several initiatives, such as Affirm Crypto. The CEO told shareholders Affirm expects to keep its headcount “essentially flat for the foreseeable future”.
“In FQ2023, we redirected the substantial majority of our R&D efforts towards margin-improving projects, repeat consumer engagement, Debit+, and plan to continue executing this focused roadmap for several quarters,” Levchin said.
The employees that are laid off in the US will be offered a minimum of 15 weeks base pay as severance plus an additional week per year of tenure, according to the company.
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The laid-off US workers will also receive a $5,000 health stipend regardless of enrollment status, covering six months of employee healthcare.However, non-US employees will receive severance and healthcare benefits “in line with local practices”.
Other layoffs
Entertainment giant Disney said on Wednesday it was laying off 7,000 employees, as CEO Bob Iger announced a reorganisation of the company he returned to lead last year.
E-commerce firm eBay Inc said on Tuesday, it will lay off 500 employees globally representing 4% of its total workforce. According to a CNBC report, in a memo to employees, CEO Jamie Iannone said the company decided to make cuts after examining the global macroeconomic environment over the past several months.
Zoom Video Communications on Tuesday announced that it will lay off about 1,300 employees or about 15% of its workforce. Chief Executive Officer Eric Yuan said that the job cuts will affect all departments across Zoom
Also read | Layoffs in 2023: Complete list of firms that have cut jobs amid economic turmoil
