Payments platform PayPal revealed Tuesday it would be cutting about 7% of its total workforce, equating to approximately 2,000 full-time workers, as the company looks to navigate a challenging macroeconomic environment.
“Over the past year, we made significant progress in strengthening and reshaping our company to address the challenging macro-economic environment while continuing to invest to meet our customers’ needs,” said Dan Schulman, PayPal president and CEO, in a statement.
"While we have made substantial progress in right-sizing our cost structure and focused our resources on our core strategic priorities, we have more work to do."
The company noted that layoffs would occur over several weeks, affecting some of its organizations more than others.
PayPal’s announcement follows a series of recent layoffs at major tech companies, including Amazon, Google, Wayfair, Microsoft, Spotify, and Hubspot.
In its third-quarter earnings report, PayPal beat earnings and revenue expectations, but the company’s stock declined since its Q4 revenue projection were below analysts’ expectations. However, PayPal still raised its earnings per share (EPS) guidance for the entire year due to its successful “productivity initiatives.”
“We’re operating in an environment where we think we’re going to continue to have inflationary pressures, where real wage growth is going to continue to be negative for a period of time, where discretionary spend will be under pressure,” said PayPal’s acting CFO Gabrielle Rabinovich on the company’s projections for 2023.
“We’re navigating that environment as best we can, and we’ve taken into consideration that range of outcomes on volume growth and on revenue growth as it relates to what we think we can deliver from an operating margin and EPS standpoint,” Rabinovich added.
PayPal is the parent company of Venmo, Xoom and Honey, among other payment brands.
PayPal Holdings Inc. is currently scheduled to report quarterly results on February 9, 2023.
