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Businesses The Almighty Buck

Airbnb Is Laying Off a Quarter of Its Workforce (techcrunch.com) 89

Posted by BeauHD from the cost-cutting-measures dept.
Airbnb announced that it is laying off around a quarter of its workforce, citing revenue declines and a need to curtail costs. TechCrunch reports: In the note, written by Airbnb CEO and co-founder Brian Chesky, the company said that 1,900 employees will be laid off, or 25.3% of its 7,500 workers. The layoffs will impact a number of internal product groups, including Transportation and Airbnb Studios, efforts that will be placed on hold, and its Hotels and Lux work, which will be "scale[d] back." The company declined to break down per-country totals for the layoffs in a phone call with TechCrunch, but its memo did note that its staffing cuts are "mapped to a more focused business." The former startup appears to be narrowing its efforts, targeting core operations and shedding more experimental and costly endeavours. According to Chesky's missive, Airbnb anticipates its 2020 revenue coming in under 50% of 2019's total; Airbnb saw around $4.8 billion in revenue last year, according to reports. The report adds: "Separated employees will receive 14 weeks of pay, and one more week for each year served at the company (rounding partial years up). The firm is also dropping its one-year equity cliff so that employees who are laid off with under 12 months of tenure can buy their vested options; Airbnb will also provide 12 months of health insurance through COBRA in the United States, and health care coverage through 2020 in the rest of the world."
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Airbnb Is Laying Off a Quarter of Its Workforce More

Airbnb Is Laying Off a Quarter of Its Workforce

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  • 7500 workers? (Score:3)

    by inicom ( 81356 ) <aem@inicom.cEEEom minus threevowels> on Tuesday May 05, 2020 @04:56PM (#60025812) Homepage

    I don't see how they could have that many employees for that type of business anyway, but it seems like they are treating their layoffs fairly.

    • Re: (Score:1)

      by Anonymous Coward

      I can't understand why all these multi-million/billion companys has no cash reserves to keep afloat for a couple of weeks etc.

      • These layoffs are a result of declining business. They don't expect the business to pick back up in a couple of weeks. So, even if they have plenty of money in cash reserves, they sure don't want to spend it on the salaries of employees they intend to lay off anyway.

        • They are also facing significant legal liability.

          When Covid spread, Airbnb offered its users 100% refunds. That was very generous of them, but the problem is that they were not Airbnb's customers, and it was not Airbnb's money to give away.

          Hosts set their own refund policies and Airbnb had no legal authority to step between hosts and guests. Many hosts had already offered guests options of rescheduling at a later date or accepting a partial refund, and many guests had accepted those terms before Airbnb se

          • Not really. AirBnB does not release the money to hosts until after arrival, so essentially they just hold the money in escrow between the time of booking and the service delivery.

            AirBnBs big problem is that they're getting a lot of competition from traditional providers. I was looking at an AirBnB for April back in Jan... I ended up finding the exact same flat on Booking.com for £50 less.

            AirBnB stands to lose more in the long run by burning the good will of their customers, especially since most

      • Re: (Score:2)

        by teg ( 97890 )

        I can't understand why all these multi-million/billion companys has no cash reserves to keep afloat for a couple of weeks etc.

        They have some cash, but they also need to prepare the business for the time that comes. It's likely that travel will take years to recover. Also, it's important to note that there is a big difference between a decrease in sales and "all travel stopped".

        • Re: (Score:3)

          by Arethan ( 223197 )

          It's almost like these companies have investors that demand their equity generate increasing value/dividends rather than cash reserves for a rainy day... oh wait, that's exactly how our capitalist systems are set up.

          All companies should have anticipated that unpredictable situations like pandemics can occur, and they should have shored themselves up with on-hand cash or other easily accessible liquidity, or they should have gotten insurance contracts to cover them. Any company that has optimized their opera

    • I don't see how they could have that many employees for that type of business anyway, but it seems like they are treating their layoffs fairly.

      More than fairly. The separation deals appear to be remarkably generous. Good for them. I wish more companies were like that.

      • Re: (Score:1)

        by Amouth ( 879122 )

        Agreed, when I got laid off September 11th 2001 (they didn't wait till the end of the day...), all i got was a "yea this is going to be bad, fend for yourself"

        Since then I've made it a point to not work where i'm a number in a random budget decision.

        • Re: (Score:3)

          by xjerky ( 128399 )

          Ok, now I have to know what industry you were in that you were immediately laid off the moment the towers collapsed. They organized a meeting and decided to enact layoffs within hours??

          • Re:7500 workers? (Score:4, Interesting)

            by Amouth ( 879122 ) on Tuesday May 05, 2020 @08:55PM (#60026632)

            I managed a data center at Tyson Square south DC for a mortgage underwriting company - pure cash flow business and they laid off nearly everyone that wasn't upper management or working on commission. They figured if they needed support they would call people up and pay them as they went.. i remember being at the bank and everyone stopping as it came on the news.. and ~4pm i got a phone call that i didn't have a job and by 5pm written instructions to mail everything in...

            So yea,, financial industry.. one of the absolute most predatory of industry

    • I don't see how they could have that many employees for that type of business anyway

      Which type of business is that? A global business dealing in legal and community issues in every major and most minor cities around the world, wrangling an endless string of legal challenges dealing with an endless string of complaints and compliance problems?

      I take it from your comment you think airbnb is some website and phone app run by a handful of programmers. I bet you their legal department alone is larger than a major law firm.

  • Sucks losing a job, but severance looks solid (Score:4, Insightful)

    by AddisonEzekiel ( 921181 ) on Tuesday May 05, 2020 @05:14PM (#60025884)
    Paid COBRA for 12 months, 3 months pay. Seems almost human.
    • At first I thought (because of my own experience) that the employees would have to pay COBRA, but it seems like that's not the case. Good.

  • Was AirBNB a COVID vector? (Score:5, Insightful)

    by hirschma ( 187820 ) on Tuesday May 05, 2020 @06:26PM (#60026224)

    Since it appears that NYC's first infections came from Europe, I seriously believe that AirBNB was an effective way of spreading the virus widely in NYC - lots of people in lots of different buildings, thus, really great dispersal in densely populated areas.

    I only mention this as AirBNB is illegal in NYC, but AirBNB continues to facilitate such activity.

    • Re: (Score:2)

      by djp2204 ( 713741 )
      I think this had more to do with the situation in NYC than AirBnB did https://youtu.be/tNflR2Ia7Hc [youtu.be]

    • Oh, certainly. Right now I'm staying in one because I'm having trouble finding a rental. We negotiated payment outside of Airbnb. So we're doing our part to not support Airbnb. This county has actually put a moratorium on short term Airbnb stays but Airbnb is not helping them with that in any way. They continue to book short term stays and collect payments.

    • I seriously believe that AirBNB was an effective way of spreading the virus widely in NYC

      Indeed, because tourists are well known for spending $2000 on flights but deciding not to go to a place because they don't want to spend a $100 hotel, just like they are equally known for hiding in that hotel / AirBnB and not going to any crowded places.

      Sometimes its sufficient to invoke Occams Razor on an argument, but other times you just have to scratch your head and say "wait, did the GP really say something that stupid?"

  • I'm in Australia (Score:4, Insightful)

    by AbRASiON ( 589899 ) * on Tuesday May 05, 2020 @09:53PM (#60026746) Journal

    but I think I speak for a good portion of people world word, especially Canadians - when I say, fuck AirBNB

    It's taking good homes off the market entirely. The whole world is full of rent seekers (especially here) - between landlords given HUGE tax relief in my country (no, not the owner occupier people who just want a home, the landlords SPECIFICALLY) and AirBNB - the cost to buy a home has never been higher.

    All I can say, is Covid19 has some silver lining. Fuck people monetising the shit out of shelter.

    • Re: (Score:1)

      by aspillai ( 86002 )

      This isn't the fault of AirBnB - it' sthe fault of regressive governance. In Canada, the government has done a poor job of detecting when a home purchase isn't a primary residence. Since capital appreciation of primary residence isn't taxed, this has allowed many to significantly enrich themselves, especially during boom times. AirBnB was one method they could take advantage of since it was easier than long term rental.

      COVID isn't going to make the AirBnB problem go away. This too will become a memory, a

    • but I think I speak for a good portion of people world word, especially Canadians - when I say, fuck AirBnB

      Yeah I agree. Except when I'm travelling at which point I disagree.

      But you said it yourself "Australia". If you think the housing problems in Australia have anything to do with AirBnB you're absolutely delusional. Hell there were housing problems in Australia back when the Howard government was running the joint and when asked about AirBnB he famously said "What the fuck is an app?"

      • Howard, you mean the sack of shit that made the CGT changes and immigration changes that fostered the shit mess we're in now?

        He's the cause of the problem.

        • He's the cause of the problem.

          Yeah, that's what I said. Except for all that irrelevant shit you just posted you're absolutely right.

    • AirBNB is also on the United Nation's list [bbc.com], along with over 100 other businesses, who are profiting from the illegal settlements in Palestine.

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