Snap Is Cutting 1,000 Jobs After an Activist Investor Said It ‘Over-Hired’
The social media company is eliminating 16% of its workforce after Irenic Capital urged leadership to boost efficiency.
When an activist investor with a 2.5% stake tells you to fire people, you listen. That’s the takeaway from Snap CEO Evan Spiegel’s announcement Wednesday that the company is — about 16% of its workforce — just weeks after Irenic Capital Management publicly called out the company for overhiring. Spiegel said the cuts would slash annualized costs by more than $500 million.
Irenic didn’t mince words in its , pointing to Meta and Block as examples of companies that got leaner through layoffs. The investor argued Snap’s market cap should be closer to $35 billion instead of its current enterprise value of around $7.9 billion. Snap’s stock has tanked more than 30% this year.
This is the third time Snap has swung the ax since 2022. Still, the company projects first-quarter revenue climbed 12% to $1.53 billion, with adjusted EBITDA around $233 million. Turns out you can cut your way toward profitability after all.
When an activist investor with a 2.5% stake tells you to fire people, you listen. That’s the takeaway from Snap CEO Evan Spiegel’s announcement Wednesday that the company is — about 16% of its workforce — just weeks after Irenic Capital Management publicly called out the company for overhiring. Spiegel said the cuts would slash annualized costs by more than $500 million.
Irenic didn’t mince words in its , pointing to Meta and Block as examples of companies that got leaner through layoffs. The investor argued Snap’s market cap should be closer to $35 billion instead of its current enterprise value of around $7.9 billion. Snap’s stock has tanked more than 30% this year.
This is the third time Snap has swung the ax since 2022. Still, the company projects first-quarter revenue climbed 12% to $1.53 billion, with adjusted EBITDA around $233 million. Turns out you can cut your way toward profitability after all.
