Discord is going to reduce its workforce by 17%, meaning 170 employees will be laid off, as confirmed by a spokesperson on Thursday.
This company, known for its messaging service among gamers, had already cut about 40 jobs in August. It’s now part of the increasing number of companies announcing workforce reductions at the beginning of this year.
Discord Announces Its Workforce Reduction
According to an internal memo from Discord CEO Jason Citron, the layoffs are essential for Discord to improve efficiency. The company experienced a significant hiring increase in 2020, and these job cuts are seen as a necessary step in streamlining operations. The information was first reported by The Verge, and as of August, Discord had a workforce of 870 employees, according to PitchBook data.
Discord had a valuation of approximately $15 billion during the peak of the tech boom in 2021. However, the high-risk tech market faced a significant contraction in 2022 due to increased inflation and rising interest rates, leading to reduced growth opportunities and higher capital costs.
In contrast to social web platforms like Meta and Snap, Discord doesn’t depend on online advertising. Instead, it is sustained by subscribers who pay a monthly fee for additional features, such as the capability to stream high-definition video. In October, the company introduced an online marketplace where users can buy digital avatars and other virtual items to personalize their accounts.
Layoffs have been a big story across the tech landscape since the calendar turned to 2024.
Recent Workforce Changes
Audible, the audiobooks unit of Amazon, is reducing its staff by 5% as part of an initiative to become “leaner and more efficient,” according to a memo from CEO Bob Carrigan on Thursday. On Wednesday, Google’s parent company, Alphabet, laid off hundreds of workers to concentrate on the company’s “biggest product priorities,” as mentioned by a spokesperson.
At the beginning of this week, Unity Software announced a workforce reduction of 25%, and at the same time, security firm Trend Micro revealed plans to cut 2% of its global staff.
Discord is reducing its workforce by 17%, following a trend in the tech industry. CEO Jason Citron states these layoffs are crucial for efficiency after significant hiring in 2020. Discord’s unique reliance on subscriber fees and features, along with an online marketplace, reflects adaptability amid industry-wide workforce changes in 2024.