Zoom fired 1,300 employees, CEO apologized and announced a 98% salary reduction himself, no bonus

Zoom fired 1,300 employees, CEO apologized and announced a 98% salary reduction himself, no bonus

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2023-02-13 15:50:04

On February 7, the online video calling platform Zoom said the company would lay off about 1,300 employees, or about 15% of its workforce. This is the latest tech giant to announce significant staff cuts. Previously, due to the increased demand for digital services because of the pandemic, Zoom had to recruit more positions to meet.

In a memo sent to employees, Zoom CEO Eric Yuan said the layoffs will affect every part of the organization. Yuan also said that he and other senior executives will receive significant pay cuts. The 52-year-old CEO admitted he made a mistake in hiring massively during the pandemic.

“As the CEO and founder of Zoom, I take responsibility for the mistakes and actions we take today. I want to show accountability not only with my words but also with my own actions. To that end, I will reduce my salary by 98% for the upcoming fiscal year and give up my corporate bonus for my 2023 financial year.”

Yuan said members of the company’s executive team will also take a 20% reduction in their base salary next fiscal year and not receive bonuses for fiscal 2023.

Shares of Zoom rose nearly 9% in midday trading on February 7, following Yuan’s announcement.

Zoom has grown very quickly since the early days of the pandemic, when many people turned to the company’s platform to work and talk to friends and relatives during the blockade. In mid-2020, Zoom reported a spike in revenue thanks to a spike in business customers because they were forced to switch to remote work.

According to Yuan, Zoom has ramped up hiring during that time to support the boom in worldwide demand. Within 24 months. Zoom has tripled in size to meet demand while continuing to innovate.

However, Zoom’s share price dropped significantly last year as people began to return to the office and return to their pre-pandemic normality.

Zoom is not the only pandemic “darling” experiencing this situation. Before Zoom, since the end of last year, many large technology companies – which have grown rapidly during the pandemic, have announced mass layoffs to cut costs in the context of the unstable economy and the needs of people. consumption declines.

Late on February 7, online shopping platform eBay also announced it would cut about 500 employees globally in the next 24 hours. Earlier, on February 6, Dell computer group said it would cut about 6,500 jobs – equivalent to 5% of its global workforce.

Jeff Clarke, co-CEO of Dell, said the company is experiencing a market situation that continues to erode with an uncertain future. Analytical data indicates that sales of personal computers fell sharply in the fourth quarter of 2022. Among large companies, Dell had the strongest decline with 37% year-on-year in 2021.

Source: CNN

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