Snap is will cut 1,300 workers and will make a major company-wide restructure to save expenses in the face of declining sales.
The layoffs mean around 20 percent of the workforce will leave.
The Snapchat maker is also phasing out at least six products including a unit that produced exclusive short shows with celebrities and influencers.
It will appoint Jerry Hunter as its first COO in seven years since the position has been empty since 2015.
Snap is winding up its social mapping app, Zenly; its music creation app, Voisey; and hardware including its drone camera, Pixy.
CEO Evan Spiegel blamed the decision on tough macroeconomic conditions in his email to employees.
He said: “While we will continue our work to re-accelerate revenue growth, we must ensure Snap’s long-term success in any environment.
“I am deeply sorry that these changes are necessary to ensure the long-term success of our business.”
Snap has over 347 million active users worldwide, has been struggling for months.
Snap said last month it would “substantially reduce” its recruiting pace after reporting its weakest quarterly growth rate since going public in 2017.
It also declined to forecast its financial performance for the current quarter due to “uncertainties in the operating environment.”
Snap’s stock price has dropped by more than 76 percent since the beginning of the year.
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Mr. Spiegel stated that the scope of the layoffs will “vary from team to team.”
He also said the changes will “substantially reduce the risk of ever having to do this again.”
The restructure is projected to save the business $500 million.
The projects and products Snap is nixing were developed to help the firm compete with its rivals and entice creators to the platform.
Zenly and Voisey, which operate independently from Snapchat, were pitted against Instagram and TikTok.
Mr. Spiegel stated in his email that Snap will prioritize community growth, revenue growth, and augmented reality.
He added that the company will continue to invest in these priorities.
Source: The New York Times