Zoom Video Communications said on Tuesday it would cut 15% of its workforce which is about 1,300 jobs.
The collaboration platform is also planning to reduce the pay of its executive leaders all because of the low demand for services after the Covid-19 pandemic.
Recall that collaboration platforms like zoom experienced skyrocketing revenues through out the pandemic year.
Report stated that during the pandemic year, 2020 to January 2021, the revenue of Zoom amounted to $2.65 billion, which is about 300 percent from just $623 million in 2019.
According to Reuters, after a fall of 63% last year, the company’s shares increased by around 9% on the news.
Chief Executive Eric Yuan announced the layoffs and his decision to forgo his fiscal 2023 corporate bonus as well as 98% of his pay. .
Eric said, “We worked tirelessly… but we also made mistakes. We didn’t take as much time as we should have to thoroughly analyze our teams or assess if we were growing sustainably, toward the highest priorities.”
During the lockdown, Zoom became a household name because of its operational video-conferencing tools. Now, the company is experiencing a slow growth.
According to Reuters, after experiencing a revenue increase of more than four times and a profit increase of nine times in fiscal year 2021, analysts predict that Zoom’s revenue will have increased by just 6.7% in fiscal year 2022.
Based on the estimations, profit decreased 38% in 2022.