Zoom Video Communications Inc. will cut 15 percent on payroll as the service adapts to slower post-pandemic growth.
Chief Executive Officer Eric Yuan said in a blog post that the company will cut about 1,300 jobs as part of the restructuring.
Yuan declared himself “responsible” for the company’s problems, saying he would cut his salary and give up his bonus.
“During the pandemic, our route changed,” Yuan said, adding that Zoom’s staff has tripled in two years. “we don’t take as much time as necessary to analyze in-depth our teams or evaluate whether we are growing sustainably.
Cuts represent a larger workforce rate than advertised in companies Salesforce Inc., Microsoft Corp. and Workday Inc. such as enterprise software.
The stock hit an all-time high in July 2020 and is now at pre-pandemic levels. It has dropped 47 percent in the last 12 months until Monday’s close.
Yuan said that “the uncertainty of the global economy” is affecting customers as people and businesses continue to use Zoom in the wake of the pandemic.
After Zoom grew with millions of users at the peak of the pandemic now trying to reverse the slowdown in growth by expanding business tools.
Despite this, it has reported single-digit revenue gains over the past two quarters, and analysts Sales continued to slow in the current quarter.
John Butler wrote that the cuts were likely an attempt to protect or improve margins in the face of slowing growth.
Competition from Microsoft’s Teams collaboration service has also become more of a concern for Zoom in recent quarters, according to industry analysts.
President Greg Tomb acknowledged the competition in an interview with Bloomberg last month, but said companies using Zoom rarely leave the platform.
added the grave The company’s biggest opportunity is to get its current customers to use the rest of its products.Including tools like Zoom phone service.
Yuan, the founder of the company, said that his base salary, which was $301,731 last year, will be cut by 98% and he will forego the company bonus for the current fiscal year.
According to a May 2022 regulation, his total compensation for fiscal year 2022 was $1.1 million.
Other top executives will accept base pay cuts of 20 percent. As of late January 2020, before Covid-19 was declared a national emergency in the US, Zoom’s workforce numbered approximately 2,500.
It has since added about 6,000 people. The cuts, announced on Tuesday, will bring Zoom’s total workforce down to early 2022 levels.
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