By Sam Boughedda
BuzzFeed (NASDAQ:BZFD) shares dropped over 21% Thursday after the company confirmed in a filing that it is cutting 15% of its current workforce and closing BuzzFeed News.
The company said the workforce reduction is part of a broader strategic reprioritization across the company to accelerate revenue growth and improve upon profitability and cash flow. It expects to complete the reduction by the end of the second quarter of 2023.
BuzzFeed estimates that the foregoing charges will range between $7 million and $11 million and expect the charges will be recognized primarily in Q2.
Meanwhile, in an email to employees, BuzzFeed Founder and CEO Jonah Peretti said cuts will take place across its Business, Content, Tech, and Admin teams, with some headcount reductions proposed in international markets.
As a result of the layoffs, the company said it can "no longer continue to fund BuzzFeed News as a standalone organization" and is beginning the process of closing it down.
"We've faced more challenges than I can count in the past few years: a pandemic, a fading SPAC market that yielded less capital, a tech recession, a tough economy, a declining stock market, a decelerating digital advertising market and ongoing audience and platform shifts. Dealing with all of these obstacles at once is part of why we've needed to make the difficult decisions to eliminate more jobs and reduce spending," Peretti said in his email.
BuzzFeed also confirmed that as part of the changes, its CRO Edgar Hernandez and COO Christian Baesler have made the decision to exit the company.