© Reuters
Investing.com – Coinbase (NASDAQ:) is cutting about a fifth of its workforce, or 950 jobs, to preserve cash during the cryptocurrency market downturn. The firm, which had about 4,700 employees at the end of September, already cut 18% of its workforce in June, citing the need to manage costs and growing “too fast” during the bull market.
“With perfect hindsight, looking back, we should have done more,” CEO Brian Armstrong said. “The best you can do is react quickly once the information becomes available, and that’s what we’re doing in this case.”
The layoffs, along with other restructuring measures, will lower Coinbase’s operating expenses by 25% for the first quarter. The crypto firm also said it expects adjusted EBITDA losses for the full year to be within an earlier “safeguard” of $500 million set last year. .
“It became clear that we would have to cut expenses to increase our chances of doing well in every scenario” and there was “no way” to do that without reducing headcount. The company will also stop several projects whose “probability of success is lower.”
Coinbase joins other tech companies that are cutting jobs after a hiring spree during the Covid pandemic. Amazon (NASDAQ:) said it would cut 18,000 jobs, while Salesforce cut its workforce by more than 7,000 people, or 10%. Elon Musk cut about half of Twitter’s (NYSE:) workforce after taking over the company last year, and Meta (NASDAQ:) cut more than 11,000 jobs, or 13%. Cryptocurrency firms Genesis, Gemini, and Kraken have also downsized.
“Every company in Silicon Valley felt like we were just focused on growing, growing, growing, and people were almost using their employee numbers as a symbol of how much progress they were making. The focus now is on operational efficiency – it’s a healthy thing for the ecosystem and the industry to focus more on those things.”