Airbnb will slash 1,900 jobs amid travel slump due to pandemic
Airbnb Inc. will lay off a quarter of its workforce or almost 1,900 workers on Tuesday, as the travel industry was severely affected due to the pandemic.
According to the memo sent by Airbnb’s Chief Executive Officer Brian Chesky, “Airbnb’s business has been hit hard, with revenue this year forecasted to be less than half of what we earned in 2019.”
Laid off workers in the U.S. will receive 14 weeks of basic pay plus an extra week for every year at Airbnb.
Earlier this year, the company said that it would use $250 Million funds to cover the losses of Airbnb’s hosts.
Airbnb halted its marketing operations last March to raise $800 Million cash reserves this year. Employees were also informed that its founders will take no pay during the upcoming months while top officials would take a 50% salary cut.
The company received a $1 billion worth of investments from private equity companies Silver Lake and Sixth Street Partners last April. The debt and equity investment sum up Airbnb’s cash reserves to $4 billion.
Airbnb said that it would use funds to attract more customers for arranging and offering homestays or tourism experiences on its platform. The company acts as a broker as it receives commissions from each booking.