Affirm announces 19% job cuts in its workforce

Affirm had hired ahead of its revenue growth during the pandemic, but as the pandemic continued, the company saw a slowdown in growth and had to make difficult decisions.

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In its second-quarter earnings report, Affirm, a US-based financial technology company, announced that it has laid off 19 per cent of its workforce. This decision, according to founder & CEO Max Levchin, was a result of the company’s efforts to streamline its operations and focus on profitable growth.

Affirm is a publicly traded financial technology company headquartered in San Francisco, United States. Founded in 2012, the company operates as a financial lender of installment loans for consumers to use at the point of sale to finance a purchase.

During the pandemic, Affirm had hired ahead of its revenue growth, but as the pandemic continued, the company saw a slowdown in growth and had to make difficult decisions.

In addition to the layoffs, the company will not be renewing several initiatives, such as Affirm Crypto, and expects to keep its headcount ‘essentially flat for the foreseeable future’.

The company will redirect its R&D efforts towards margin-improving projects, repeat consumer engagement, and Debit+.

Levchin expressed gratitude to the affected employees and offered them severance and healthcare benefits. US-based employees will receive a minimum of 15 weeks base pay as severance plus an additional week per year of tenure, and a $5,000 health stipend covering six months of employee healthcare, regardless of enrollment status. 

Non-US employees will receive severance and healthcare benefits ‘in line with local practices’.

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