The internet’s entertainment giant BuzzFeed plans to cut 15 percent of its workforce, US media reports said Wednesday, according to AFP.
The cuts, which are expected to affect between 200 to 250 jobs, come as the company is seeking to reinvest resources in more promising areas such as content licensing and e-commerce, The New York Times and Wall Street Journal reported.
In an email by chief executive Jonah Peretti titled "Difficult Changes," the news was announced, according to the Times.
"I'm writing with sad news: we are doing layoffs at BuzzFeed next week. We will be making a 15 percent overall reduction in headcount across the company. I'm sending this tonight because I wanted you to hear it from me directly instead of from the press," Peretti said in his email.
One reason for the changes was to nudge the firm toward profitability while it searches for potential mergers, according to the Journal's sources. The other reason was to avoid another round of fundraising. BuzzFeed raised around $500 million in the last round in 2016 and was valued at $1.7 billion, with its main investors including Comcast's NBCUniversal which has invested $400 million.
BuzzFeed has struggled to expand digital advertising sales, like other online publishers, in line with its investors' expectations; as Google and Facebook continue to dominate the sector.
It launched in 2006 and was long primarily known for its humorous content and memes. Later, it launched a news unit that, despite being a financial drag on the company, has built a strong reputation and was a finalist for a Pulitzer prize last year.
BuzzFeed News found itself at the center of a controversy last week after it reported President Donald Trump instructed his lawyer to lie to Congress about plans to build a Trump Tower in Moscow - a story that was denied by the office of Special Counsel Robert Mueller who said it was "not accurate."