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BuzzFeed will lay off 16 percent of employees
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By Nithya Bose in US business news, posted February 22, 2024
Online media company BuzzFeed is slashing 16 percent jobs to cut costs.
The firm announced the sale of Complex, a youth-focused publisher, to NTWRK, a Los Angeles-based live shopping platform, for $108.6 million.
The layoffs come amid wider challenges in the media and entertainment sectors, with many organizations striving to reduce expenses and streamline operations.
Jonah Peretti, BuzzFeed's CEO, said the cuts would predominantly impact the business and administrative sectors.
However, the reductions won’t affect divisions like HuffPost, Tech, BuzzFeed Studios, Tasty, and First We Feast.
He said: “The changes we announced today will enable an exciting next stage for our company, with increased focus on our iconic brands — BuzzFeed, HuffPost, First We Feast and Hot Ones, and Tasty; a more efficient cost structure and operational model; and the ability to accelerate innovation powered by AI and interactive content formats.”
BuzzFeed's stock has significantly declined from its initial public offering price of $10.95 in December 2021 to just 22 cents.
It puts the company at risk of being delisted by Nasdaq unless its share price rebounds to above $1 by May.
However, the announcement led to a temporary surge in stock value in after-hours trading.
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Buzzfeed has struggled in recent years
Analysts view this move as a critical juncture for BuzzFeed, pointing to its fluctuating fortunes since its inception.
The company had an early success and won a Pulitzer Prize in 2021.
However, it has struggled to maintain its revenue amid the dominance of tech giants like Facebook and Google over digital advertising and algorithm changes' impact on content distribution.
The sale of Complex is part of BuzzFeed's strategy to streamline its portfolio and focus on profitability and agility, keeping First We Feast as part of its core operations.
The restructuring comes after the company shut down its News division last year, marking a significant pivot in its business strategy since its 2006 launch.
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