The layoffs occur nearly exactly a year after PayPal reduced its personnel by 7%.
By sending a letter to employees on Tuesday, the CEO of PayPal, Alex Chriss, informed them that the firm would be laying off nine percent of its workers. The letter was made public by PayPal a few hours later. It was reported previously by Bloomberg that the decision will have an effect on approximately 2,500 employees, who will learn their fate between today and the end of the week depending on the verdict. Almost exactly one year after the business laid off more than 2,000 employees in an effort to reduce expenses, PayPal has already begun to lay off employees.
Layoffs at technology corporations have persisted into 2024, despite the fact that thousands of jobs were eliminated in 2023. Jack Dorsey’s Block, the business that owns Cash App, Foundational, and Square, carried out its second wave of layoffs in the span of two months, resulting in the termination of roughly one thousand employees. These layoffs occurred on the same day that PayPal announced its most recent cutbacks. More than a thousand people were let go from their positions in Google’s assistant and hardware departments earlier this month. Google CEO Sundar Pichai issued a warning to staff that they should be prepared for additional layoffs throughout the year. During the month of January, a number of companies, including Discord, eBay, Riot Games, TikTok, Microsoft, iRobot, Amazon, Unity, and Duolingo, among others, have together eliminated thousands of jobs.
PayPal was one of the first corporations to enter the online payments sector; but, in recent years, competitors such as Zelle and other companies with significant finances such as Apple have entered the space. PayPal is experiencing pressure as a result of the other companies operating in the payments business. Since the beginning of this month, four analysts have lowered the stock of the company, according to Bloomberg. The letter stated that the company will “continue to invest in areas of the business we believe will create and accelerate growth,” as stated by Chriss.
Although PayPal is seeing significant growth during the year 2023, the corporation is still laying off employees. At the end of September 2023, the company’s revenue was $7.42 billion, which represents an increase of more than eight percent when compared to the revenue it had generated the previous year. It announced a “double digit growth” in the number of transactions that took place over its platform, which contributed to the company’s success in exceeding earnings estimates. During PayPal’s most recent earnings call, which took place in November 2023, Chriss, who had assumed the role of CEO of the firm in September 2023, stated that the company’s expenses were “too high” and were “slowing us down.” This information was reported by The Information.