Zoom Video Communications Inc. it is shedding 15% of its workers as the service that has become ubiquitous during the pandemic adjusts to slower growth.
The company will cut about 1,300 jobs as part of a restructuring, chief executive Eric Yuan she said in a blog post on Tuesday. Yuan called himself “responsible” for the company’s problems and said he would cut his salary and waive his bonus.
“Our trajectory has changed forever during the pandemic,” Yuan said, adding that Zoom’s headcount has tripled in two years. “We didn’t take as much time as we should have to dig deep into our teams or assess whether we were growing sustainably.”
The cutbacks account for a larger share of the workforce than announced cuts at business software companies including Salesforce Inc., Microsoft Corp. and Workday Inc. Shares jumped as much as 10% on the news to $84.87. The stock tumbled 47% in the 12 months to Monday’s close.
After gaining millions of users at the height of the pandemic, Zoom is now looking to reverse the growth slowdown by expanding its business tools. However, it has posted single-digit revenue increases over the past two quarters, and analysts expect sales to have continued to decelerate in the current quarter.
Yuan, the founder of the San Jose, California-based company, said his base salary, which was $301,731 last year, will be cut by 98 percent and he will waive a company bonus for the 2023 fiscal year. His total compensation for fiscal 2022 was $1.1 million, according to a May 2022 filing. Others in the executive leadership will take 20% reductions in base salary.
The company will cut about 1,300 jobs as part of a restructuring, chief executive Eric Yuan she said in a blog post on Tuesday. Yuan called himself “responsible” for the company’s problems and said he would cut his salary and waive his bonus.
“Our trajectory has changed forever during the pandemic,” Yuan said, adding that Zoom’s headcount has tripled in two years. “We didn’t take as much time as we should have to dig deep into our teams or assess whether we were growing sustainably.”
The cutbacks account for a larger share of the workforce than announced cuts at business software companies including Salesforce Inc., Microsoft Corp. and Workday Inc. Shares jumped as much as 10% on the news to $84.87. The stock tumbled 47% in the 12 months to Monday’s close.
After gaining millions of users at the height of the pandemic, Zoom is now looking to reverse the growth slowdown by expanding its business tools. However, it has posted single-digit revenue increases over the past two quarters, and analysts expect sales to have continued to decelerate in the current quarter.
Yuan, the founder of the San Jose, California-based company, said his base salary, which was $301,731 last year, will be cut by 98 percent and he will waive a company bonus for the 2023 fiscal year. His total compensation for fiscal 2022 was $1.1 million, according to a May 2022 filing. Others in the executive leadership will take 20% reductions in base salary.
