Jobs

PayPal to cut 2,500 global jobs in second wave of layoffs

Published

11 months ago

January 30, 2024

Admin

PayPal to cut 2,500 global jobs in second wave of layoffs

PayPal will reduce its global workforce by about 9% this year as chief executive Alex Chriss, who took over in September, grapples with rising competition, profit pressures and a raft of analyst downgrades.

In a letter to staff on Tuesday, Mr Chriss said the decision was made to “right-size” the company through both direct cuts and the elimination of open roles throughout the year. Affected staff will be notified by the end of the week, according to the letter.

The news is further evidence that the global tech industry layoffs – a feature of 2023 – is far from being at an end. PayPal employs more than 2,500 people in Ireland.

PayPal, which employed around 29,900 global workers at the end of 2022, announced a similar round of cuts last January. The latest move will affect about 2,500 workers.

Eliminating jobs will allow the firm to “move with the speed needed to deliver for our customers and drive profitable growth”, Mr Chriss said in the letter. “At the same time, we will continue to invest in areas of the business we believe will create and accelerate growth.” Shares of the payments giant have plunged more than 20% over the past year as earnings faltered and the company lowered its full-year guidance for adjusted operating margin. PayPal named Mr Chriss last year to replace Dan Schulman.

PayPal was an early disrupter in the payments industry, but rivals including Apple have since crowded the space, leaving PayPal struggling to keep pace. At least four analysts downgraded the shares this month, citing a range of concerns from rising competition to pressure on profitability.

Mr Chriss said on PayPal’s third-quarter earnings call that the firm’s “cost base and complex structure” had slowed progress, an issue he plans on addressing to boost the firm’s operating leverage. The San Jose, California-based company is set to report fourth-quarter results next week.

“There hasn’t been a lot to celebrate” over the past few years, Mr Chriss told CNBC earlier this month.

Since Chriss took the helm, he’s revamped PayPal’s leadership roles and made clear that he plans to streamline what grew into a bloated business during the pandemic.