Discord Lays Off 17% of Workforce To Streamline Operations

Discord, the popular communication platform, is laying off 170 staff, a significant 17% of its workforce. The CEO, Jason Citron, stated that the move’s aim is to enhance the company’s focus and improve functionality, elevating its organizational agility.

This major layoff announcement came during a company-wide meeting and in an internal memo. It will affect various departments, making it Discord’s largest employee cutback after last year’s reduction of 4%. Record layoffs have been a running trend in the tech industry recently, with Google and Amazon both resorting to workforce trims last week.

Discord is not in any financial crisis, even though it is still striving to turn profitable and stimulate user growth, which spiked during the pandemic. The staff cuts indicate an admission by the company that its workforce expanded too quickly, overextending operations and reducing efficiency. In the last two years, its workforce has increased fivefold.

The move to shrink its workforce comes amid thoughts of going public since Discord rejected Microsoft’s $12 billion acquisition offer in 2021. However, according to sources, the company is not quite ready for this step. Despite these changes, Discord is well-funded, having raised around $1 billion, with more than $700 million in cash reserves. Its primary goal this year is to become profitable.

In the internal memo, there was an acknowledgment of the significant growth and change experienced by the company over the last few years, leading to a need to streamline operations. Regrettably, this has resulted in the decision to reduce the workforce. However, a firm assurance was given that the decision was taken with the long-term interest of the users, the business, and its mission at heart.

Moving forward, employees were told they would receive an email informing them of their employment status. The company has committed to supporting those leaving with five months of salary, five months of continued benefits, three months of outplacement services, and other benefits such as equity vesting of awards.

Despite this difficult period, the CEO expressed deep appreciation for the departing employees, acknowledging their contributions to the company. He emphasized the importance of maintaining connections beyond the confines of the office and urged remaining employees to support each other through this challenging phase.