Tech layoffs loom as more companies announce big cuts to their workforces

Despite some late-week respite in the stock market on Friday, many tech firms are facing an increasingly tough reality: Interest rates are going up, as are prices, and the economy may be heading for a serious slowdown. We may be seeing the initial signs of a weakened economy manifest in the once-frothy tech sector, too, as companies start to lay off employees. Among them are online used car retailer Carvana, which cut 2,500 employees last week, roughly 12% of its staff, according to data sourced from Layoffs.fyi, an online tool created by entrepreneur Roger Lee after the onset of the pandemic two years ago. Carvana wasn’t alone—one of its key competitors, Vroom, likewise laid off 270 employees, around 14% of its workforce. But those are just two of many tech companies that have started laying off employees since early May—showing that the tech sector, as a whole, appears to be scaling back as the economy enters a turbulent stretch. Here are some other tech companies that are cutting jobs, per Layoffs.fyi’s data:

Doma: The San Francisco-based digital title insurer was unable to turn a profit this quarter, and as such, laid off 15% of its staff. Zwift: The company, which makes at-home devices for indoor cycling training (similar to Peloton), announced 150 layoffs as part of a restructuring move. DataRobot: The Boston-based AI startup laid off 7% of its workers in a cost-cutting move. Reef: A Miami-based tech company specializing in ghost kitchens, among other things, is similarly laying off 750 employees, or roughly 5% of its workforce. Cameo: The app that allows celebrities to sell personalized videos to fans, laid off 87 staff members, or 25% of its workforce, earlier this month. Also worth noting: Digital trading platform Robinhood cut 340 jobs in late April, Netflix eliminated 25 positions, and digital weight loss platform Noom let go of nearly 500.

The layoffs from across the tech industry are occurring for a variety of reasons, but it’s clear that the sector—which experienced explosive growth over the past two decades, leading to the creation of hundreds of tech “unicorns” born of deep-pocketed venture capitalists and private equity firms—may be running out of froth. In fact, VCs may be becoming more tight fisted as the economy itself tightens; venture funding fell 13% quarter-over-quarter during the first three months of 2022, according to data from Crunchbase. Further, investors appear to be reassessing their overall strategies, which may impact high-growth tech companies. “The increase in discount rates corresponding with market volatility has led to a fundamental repricing of valuations and a sharp rotation away from stocks with relatively high implied growth rates toward stocks with relatively low growth rates,” writes Andrew Akers, an analyst on the quantitative research team at PitchBook. Correction: An earlier version of this story misstated the percentage of workers laid off at DataRobot. It’s 7%, not 70%.  

https://www.fastcompany.com/90752601/tech-layoffs-loom-as-more-companies-announce-big-cuts-to-their-workforces?partner=rss&utm_source=rss&utm_medium=feed&utm_campaign=rss+fastcompany&utm_content=rss

Created 3y | May 17, 2022, 8:20:52 PM


Login to add comment

Other posts in this group

A TikTok ‘Fantasy Pope League’ lets you bet on who will become the next pope

After Pope Francis’s funeral was held over the weekend, attention has now turne

Apr 29, 2025, 12:40:04 AM | Fast company - tech
Deliveroo shares surge following DoorDash’s $3.6 billion proposed takeover

Shares of Deliveroo, the food delivery service based in London, are hitting three-year highs on Monday after it received a $3.6 billion

Apr 28, 2025, 10:20:09 PM | Fast company - tech
Who is Aaron Parnas? He’s the guy breaking news to Gen Z

If you’re not on TikTok, you may not have heard of Aaron Parnas. But for many young people across the U.S., he’s a prominent political news source, with over 3.5 million followers on TikTok and ju

Apr 28, 2025, 10:40:09 AM | Fast company - tech
Inside a single day on TikTok: 117 million videos, billions of views

Getting a sense of the scale of social media platforms can be tricky. While tech companies often share self-serving metrics—like monthly active users or how likely users are to buy products after

Apr 28, 2025, 10:40:08 AM | Fast company - tech
Is social media hurting teens’ mental health? It’s complicated

Social media is terrible for teens’ mental health—or is it?

At the same time that

Apr 28, 2025, 6:10:07 AM | Fast company - tech
3 quick, easy AI chatbot prompts that can help you do your job better

Fun fact: The saying “work smarter, not harder” is coming up on its 100th birthday. Coined

Apr 28, 2025, 6:10:06 AM | Fast company - tech