PayPal, NetApp to cut total of about 3,000 employees

February 1, 2023  11:55

PayPal, a provider of online payment services, and NetApp, a developer of data protection and management solutions, will lay off a total of about 3,000 employees.

Job cuts at PayPal

PayPal plans to lay off about 2,000 employees, or 7% of its workforce. As reported by the BBC, PayPal explained that it had to make such a decision because it faced a “challenging macro-economic environment."

We must continue to change as our world, our customers and our competitive landscape evolve, said PayPal CEO and president Dan Schulman.

According to Bloomberg, Dan Schulman said the layoffs will begin in the coming weeks.

 "While we have made substantial progress in right-sizing our cost structure, and focused our resources on our core strategic priorities, we have more work to do," Schulman said.

The agency notes that the slowdown in the growth rate of transactions made on this platform after the coronavirus pandemic has negatively affected the price of PayPal's shares; their price has continuously decreased in recent months. The company has announced that it will cut costs, including by cutting jobs and closing offices.

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Downsizing at NetApp

NetApp has announced that it plans to cut 8% of its workforce. As of April last year, according to NetApp's data, the company's global workforce was 12,000 employees; that is, about 960 employees will be cut now.

NetApp CEO George Kurian said economic uncertainty is leading to greater conservatism in IT spending; meaning customer spending has fallen.

"We are not immune to these challenges," he said, adding that the company plans to focus on those areas of its business where it can achieve the greatest growth.

The company's CEO also said that the layoffs will begin this quarter, and the process is planned to be completed by the 2023 fiscal year end.

Kurian detailed that the Europe, Middle East, Africa, and Asia Pacific regions are continuing local consultations on the reductions.

Notably, these job cuts come despite the fact that NetApp reported good results in the second fiscal quarter, which ended on October 28 2022. The company received a record revenue of $1.66 billion, which is 6% higher than last year. NetApp's profit was $750 million, which is three times the $224-million profit in the same quarter of the previous fiscal year.

Widespread reductions in the IT sector

It should be noted that the reductions in the IT sector have started since last year. A number of large IT sector companies have announced layoffs. For example, Amazon has announced that it plans to cut 18,000 jobs, Google (Alphabet) has announced that it will cut 12,000 employees, and, moreover, even $1-million salary recipients have been cut.

Among the IT giants, Microsoft announced that it plans to cut 10,000 employees, and IBM will cut 3,900 jobs.

Vimeo and Micron Technology also announced layoffs last December, and last week Sweden's Spotify said it plans to lay off about 10,000 employees, or 6% of its total workforce. 

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