Airbnb Layoffs 2023: What to Know About the Latest ABNB Job Cuts
The trend of tech companies employing layoffs now includes Airbnb (NASDAQ:ABNB). The homestay and lodging innovator has implemented small-scale job cuts, laying off 30% of its recruiting division. While that may not sound like a small number, …
The trend of tech companies employing layoffs now includes Airbnb (NASDAQ:ABNB). The homestay and lodging innovator has implemented small-scale job cuts, laying off 30% of its recruiting division. While that may not sound like a small number, investors need to see the bigger picture. The Airbnb layoffs impacted only 0.4% of the company’s overall workforce. That’s a tiny fraction compared to the 8% Eventbrite (NYSE:EB) planning to lay off, or the 8% Waymo has already let go. Layoffs sometimes signal that a company is in distress, but that’s not how investors should interpret this news.
It’s true that for a long time, Airbnb avoided job cuts as many of its tech sector peers opted for workforce reductions. But as a spokesperson for the company who spoke to Bloomberg emphasized, this decision is “not an indication of more widespread layoffs.” This suggests that the Airbnb layoffs are actually part of the company’s strategic plan for growth in the coming year.
Let’s dive deeper into what investors should expect as the company progresses.
The Airbnb Layoffs: A Closer Look
Job cuts don’t always boost share prices, but ABNB stock isn’t reacting poorly to this news at all. On the contrary, shares are up almost 2% today as news of the Airbnb layoffs continues to trend. The company has had an overall excellent year, rising 50% year-to-date (YTD) after 2020 saw the travel sector plunge. As Bloomberg reports:
“Airbnb made painful choices around lay offs and restructuring in the early days of Covid-19, cutting about 25% of staff. Chief Executive Officer Brian Chesky said late last year that the state of the economy won’t affect how the business is run. Chief Financial Officer Dave Stephenson said on the company’s latest earnings call that it still sees room to hire.”
Last month, Stephenson stated that while the company would grow modestly throughout 2023, it would still grow. The Airbnb layoffs shouldn’t be seen as anything other than a component of the company’s plan for growth. It will likely use the funds that the layoffs free up to hire in different areas that may help with growth even more. The company still boasts solid fundamentals and has plenty of room for growth in 2023, regardless of job cuts.
On the date of publication, Samuel O’Brient did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Samuel O’Brient has been covering financial markets and analyzing economic policy for three-plus years. His areas of expertise involve electric vehicle (EV) stocks, green energy and NFTs. O’Brient loves helping everyone understand the complexities of economics. He is ranked in the top 15% of stock pickers on TipRanks.
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