Discord lays off 17 percent of employees in second round of job cuts

Discord is laying off 17 percent of its workforce, or about 170 people, the largest to date after the messaging app laid off 4 percent of staff last August. This move, the largest layoff for the messaging app so far, follows a 4% staff reduction in August last year.

Discord CEO Jason Citron said in an internal memo that the decision was meant to “sharpen our focus and improve the way we work together to bring more agility to our organization.” Citron acknowledged that the layoffs were necessary due to the company’s rapid expansion in recent years.

“We grew quickly and expanded our workforce even faster, increasing by 5x since 2020,” Citron wrote. “As a result, we took on more projects and became less efficient in how we operated,” he added.

According to an internal memo obtained by The Verge, the layoff will impact employees across various departments. Discord’s decision to reduce its workforce comes just nine months after rejecting a $10 billion sale offer from Microsoft. Instead, the company opted to raise $500 million in new funding, valuing it at around $15 billion.

While Discord doesn’t appear to be in dire financial trouble, it is still working towards profitability and recovering user growth after a pandemic-induced surge. Citron admitted in the memo that the company had grown too quickly, expanding its workforce by 5 times since 2020, leading to inefficiencies in operations.

This round of layoffs contributes to the broader trend of job cuts in the tech industry. Other notable companies, including Amazon’s Twitch, have also announced significant staff reductions. The tech industry has witnessed numerous layoffs in recent months, with more than 35 companies letting go of 5,586 workers this year, according to Layoffs.FYI.

Discord is best known for its free service that lets gamers communicate by video, voice, and text. The platform became very popular last year as people who were stuck at home during the pandemic turned to Discord for study groups, dance classes, book clubs, and other virtual gatherings. The Discord platform also includes an invite-only place with plenty of room to talk.

Founded in 2012, the company hired Tomasz Marcinkowski as its CFO in 20221 as part of its strategy to boost revenue after a year of pandemic-driven growth.