Zhitong Financial APP has learned that due to recent quarters$PayPal Holdings Inc (PYPL.US) $The growth of customer spending on the platform has almost stalled, and PayPal Holdings Inc will start laying off staff engaged in risk management and operations this week to boost profit growth.
The company has laid off dozens of employees working in Chicago, Omaha, Nebraska and Chandler, Arizona, according to people familiar with the matter. In addition, PayPal Holdings Inc announced plans for permanent layoffs this month, cutting more than 80 jobs at its headquarters in San Jose, California, according to documents.
"Management is constantly evaluating how the company should operate to ensure that the company is ready to meet the needs of customers and to support the company's strategic business priorities through the best corporate structure and management processes," PayPal Holdings Inc said in a statement. to achieve the sustained growth and long-term development of the company's profits. "
It is understood that in the first quarter of this year, customer spending on PayPal Holdings Inc platform was $323 billion, an increase of only 15%, the smallest increase in nearly five years. The main reason for the decline is that as the epidemic eased and supply chain bottlenecks hindered the procurement of e-commerce companies, more consumers returned to brick-and-mortar stores. To make matters worse, PayPal Holdings Inc's former parent company, eBay (EBAY.US), is also stepping up efforts to transfer the payment business on PayPal Holdings Inc's platform.
PayPal Holdings Inc's number of employees has been rising in recent years, with 30900 employees by the end of last year, an increase of 33 per cent from before the outbreak. The company said last month that it was working to improve its operating margin. Dan Schulman, the company's chief executive, said the company had begun to simplify the company's operating model before the outbreak, but the company was forced to suspend the work because of a surge in business on its platform in the early stages of the outbreak. "We will return to this work with new focus, energy and goals," Schulman said.
PayPal Holdings Inc warned in a regulatory document that in the three months after the launch of "strategic layoffs", the company would incur 20 million dollars in costs as a result of some corporate restructuring. PayPal Holdings Inc said most of the costs were related to severance pay and other employee benefits. PayPal Holdings Inc said the company expects to bear an additional $100m in restructuring costs this year, but the layoffs will eventually help the company save about $260 million a year in costs related to employee compensation.
"because of our new work model, we will continue to review our needs," PayPal Holdings Inc said in the document. " "Strategic actions and cash payments related to the plan are expected to be largely completed by the fourth quarter of 2022."