Growth During Pandemic
Zoom experienced significant growth during the pandemic as many people were forced to work from home and social distance from friends and family. CEO Eric S. Yuan wrote that the company grew three times its size, but also made mistakes in the process.
In a statement, Yuan apologized for not thoroughly analyzing the company's teams or assessing if it was growing sustainably. He added that he is accountable for these mistakes and will be reducing his salary by 98% and forgoing his corporate bonus. The executive leadership team will also be reducing their base salaries by 20% for the coming fiscal year and forfeiting their bonuses.
Employees affected by the layoffs were notified via email with instructions on what they need to know. The email was sent to both their Zoom email and personal emails, with some employees receiving the notification after work hours or while they were sleeping.
Layoffs in the Tech Industry
Zoom's layoffs are part of a larger trend in the tech industry as 91 tech companies have laid off more than 24,000 employees in the first two weeks of 2023, according to layoffs.fyi. Tech companies hired and expanded aggressively during the COVID-19 pandemic, but as earnings weakened and fears of an impending recession increased, layoffs began happening in 2022 and continued into 2023. On the same day as Zoom, eBay announced it was laying off 500 workers.
This is one of the rare cases where an executive team is taking accountability for layoffs beyond a simple statement of apology.
Technomancer is a science and tech enthusiast who enjoys writing about software and AI and other tech topics.