Amongst the vigorous layoffs by tech companies, Zoom Video Communications Inc is the recent to join the list as it fires approximately 1,300 employees owing to over-hiring, uncertain global macro-economic conditions and strong tailwinds.
“We have made the tough but necessary decision to reduce our team by approximately 15 per cent and say goodbye to around 1,300 hardworking, talented colleagues,” Eric Yuan wrote. Yuan stated that he and other executives will take a significant pay cut. In the message to employees, he admitted to making “mistakes” in how quickly the company grew during the pandemic.
“As the CEO and founder of Zoom, I am accountable for these mistakes and the actions we take today- and I want to show accountability not just in words but in my own actions,” Eric Yuan wrote.
He added, “To that end, I am reducing my salary for the coming fiscal year by 98 per cent and foregoing my FY23 corporate bonus. Members of my executive leadership team will reduce their base salaries by 20 per cent for the coming fiscal year while also forfeiting their FY23 corporate bonuses.”
Zoom became a popular name during lockdown when it came as a sigh of relief for the companies owing to the companies demand for virtual working. The company hired many employees during pandemic due to its surge in demand but now joins US companies in reining in costs to brace for a potential recession.
The shares of Zoom video fell to about 90 per cent in comparison to October 2020 because of the pandemic boom fadeout. Shares closed up 9.9 per cent on the announcement of the news. The makers of the video conferencing software also announced that its executive leadership will also witness 20 per cent cut in base pay.