Snapchat is reportedly planning to lay off approximately 20% of its workforce. According to The Verge, the company, which employs over 6,400 people, will begin laying off workers on Wednesday.
Cuts are expected in the company’s hardware division, which recently halted development on the Pixy selfie drone. According to the report, a group working on tools to help developers build games and mini apps for Snapchat will be among the hardest hit by the layoffs.
Zenly, a social mapping app purchased by Snap in 2017 and run independently, is expected to be severely impacted. According to the report, the advertising sales team will also be restructured.
Snapchat has had a difficult year, with its stock price falling by 80 percent since January amid a broader economic slowdown that has impacted many notable tech companies. Snap has stated that it will seek to reduce costs while hiring fewer new employees.
The company reported poor earnings results for the April-June quarter, causing its stock to drop by 40%.
The $4 per month Snapchat+ subscription service, which offers early access to new features such as seeing who re-watched a story and pinning a friend to the top of the chat history, has been a recent bright spot for Snap. In the first month or so, over a million people signed up.