Reddit to Downsize Workforce Amid Restructuring
Social media company Reddit is laying off roughly 90 employees and slowing hiring as it restructures key parts of its business.
Reddit is making the moves to address priorities, including funding projects and achieving its goal of breaking even next year, Chief Executive Steve Huffman told employees in an email seen by The Wall Street Journal.
The job cuts amount to around 5% of Reddit’s workforce of approximately 2,000 people. “We’ve had a solid first half of the year, and this restructuring will position us to carry that momentum into the second half and beyond,” Huffman said in the email.
He added that the company would reduce its hiring for the rest of the year to about 100 people from an early plan to hire 300.
Founded in 2005, Reddit is known for its message boards called subreddits that focus on a range of topics, plus its “ask me anything” digital town halls with celebrities, politicians and subject-matter experts.
The company was sold to Condé Nast in 2006, and the magazine publisher’s parent, Advance Publications, spun Reddit off in 2011 and remains a shareholder. Mr. Huffman joined as CEO in 2015.
Reddit filed paperwork to go public in late 2021, just as tech-stock valuations began to slip. It hasn’t yet followed through on those plans. >>Nigerian Treasury Bills Yield Rises to 7%
The company makes the bulk of its revenue from advertising, though last month it said it would start charging some third-party developers — including artificial intelligence companies — for access to its application programming interface, or API, as part of an update to its terms of service.
Reddit gained attention in early 2021 when its WallStreetBets subreddit became a hot spot for individual investors who rallied around GameStop and other so-called meme stocks. Huffman later told the Journal that the episode brought in millions of new users and advertisers.
In mid-2021, Reddit said it had a valuation of about $10 billion after raising more than $400 million from longtime investor Fidelity Investments.
Many other technology companies have downsized this year and late last year, including industry heavyweights Amazon.com, Facebook parent Meta Platforms, Google parent Alphabet and Microsoft. Some slashed 10,000 jobs or more, saying they were feeling the effects of inflation and rising interest rates. Some said they had added too many workers in recent years.
