Airbnb, a leading platform which connects travelers with places to stay around said that it will be laying off 25% of its employees due to severe decline in revenue and the need to curtail costs.
Brian Chesky, in a memo said that in total 1900 employees will be laid off. This comes to around 25.3% of the global workforce. The rumor of Airbnb laying off employees in the wake of Covid-19, which has severely impacted travel and tourism industry, seems to be coming true.
In order to infuse liquidity in the company, Airbnb has recently added two $1 billion tranches of debt. Due to Covid-19, many of Airbnb users had to cancel reservations and Airbnb had to facilitate free cancellations.
Out of our 7,500 Airbnb employees, nearly 1,900 teammates will have to leave Airbnb, comprising around 25% of our company. Since we cannot afford to do everything that we used to, these cuts had to be mapped to a more focused business.
Brian chesky in a note to Airbnb employees
Brian also said that Airbnb will be dropping the one-year cliff on equity for everyone Airbnb has hired in the past year so that everyone departing, regardless of their tenure with Airbnb, is a shareholder.
For those who will be leaving the company, Airbnb will be looking across severance, equity, healthcare, and will provide job support.
