Airbnb has announced this afternoon that around one-fourth of its workforce will be laid off. Airbnb is a well-known private company that connects travelers with places to stay.
Several internal product groups will be affected by this layoff. The impact will as well be on Transportation and Airbnb Studios, efforts that will be placed on hold, and its Hotels and Lux work, which will be “scale[d] back.”
Airbnb CEO and co-founder Brian Chesky wrote a note which said that 25.3 per-cent of its 7,500 workers will be laid off by the company or 1,900 employees.
According to Chesky’s message, Airbnb anticipates its 2020 revenue coming in under 50% of 2019’s total; Airbnb saw around $4.8 billion in revenue last year, according to reports.
Previously Airbnb had admitted that layoffs were being made because of the COVID-19, a disease spread by the coronavirus. Since this disease started lockdown has been imposed almost globally which has severely impacted tourism and travel.
In recent weeks, the company has rapidly added capita which also includes two $1 billion tranches of debt, providing extra liquidity as the world came to a standstill, freezing travelers in-place and decimating global travel spend. Like many other companies, even Airbnb could not dodge a crisis that is hitting its world directly.
Airbnb has allowed users to cancel some reservations without penalty an effort to keep both the demand and supply sides of its marketplace healthy enough to survive hibernation. It has also provided financial assistance to its hosts.
Separated employees will receive 14 weeks of play, and one more week for each year served at the company (rounding partial years up). To make sure that employees who are laid off with under 12 months of tenure can buy their vested options the firm is also dropping its one-year equity cliff. 12 months of health insurance through COBRA in the United States would also be provided by Airbnb along with health care coverage through 2020 in the rest of the world.
Co-founder and CEO Brian Chesky called coronavirus pandemic “the most harrowing crisis of our lifetime”.
He had written that since we are in a global crisis due to the pandemic and nobody knows when this pandemic will end, the burden on healthcare costs should be reduced.