Discord announces workforce reduction of 17%, will layoff 170 employees

Discord, the popular messaging service widely used by gamers, has confirmed the layoff of 170 employees, constituting 17 percent of its workforce, CNBC reported. This announcement follows a previous reduction of around 40 jobs in August, aligning with a trend of companies implementing cuts early in the new year.

CEO Jason Citron communicated in an internal memo that these layoffs are deemed necessary for the company to enhance efficiency, especially after a substantial hiring surge in 2020. The Verge, the first to report on the job cuts, shared insights from Citron's memo. Discord had a workforce of 870 employees as of August, as per PitchBook data.

Market Dynamics and Valuation Discord, ranked 18th on CNBC's Disruptor 50 list for 2023, experienced a valuation of approximately $15 billion in 2021 during the . However, the tech market contracted significantly in 2022 due to escalating inflation and rising interest rates, impacting high risk tech companies like Discord.

Unlike platforms such as and Snap, Discord's revenue model doesn't rely on online advertising. Instead, it is sustained by subscribers who pay a monthly fee for additional features, including high definition . In October, the company introduced an online marketplace allowing users to buy digital avatars and other virtual items to customize their accounts.

Tech Industry Layoffs Trend in 2024 have been a prevalent theme across the tech industry in 2024. Audible, Amazon's audiobook unit, is by 5 percent to achieve a "leaner and more efficient" structure, according to CEO Bob Carrigan. Similarly, Google parent Alphabet recently laid off hundreds of workers to focus on its "biggest product priorities." Unity Software and Trend Micro also announced layoffs, affecting 25 percent and 2 percent of their global staff, respectively.

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