BuzzFeed lays off 50 after Covid-19 pandemic hurt lucrative ad deals

BuzzFeed's efforts to reduce costs have also included pay cuts through the end of the year. PHOTO: SCREENGRAB FROM BUZZFEED.COM

NEW YORK (BLOOMBERG) - BuzzFeed laid off 50 of the 74 employees who were furloughed this spring as the digital media company struggles to replace lost revenue during the pandemic.

The cuts include 10 employees in BuzzFeed's news division, as well as staff involved with its studio, sales and administration, the company said.

BuzzFeed lost some custom advertising deals in areas like hospitality and travel at the start of the pandemic, costing the company tens of millions of dollars in revenue. In addition, paused some affiliate deals. That meant that when BuzzFeed readers bought a beauty product via the site, for instance, the media company was no longer getting a cut of the sale.

The 50 jobs eliminated represent 5.7 per cent of BuzzFeed's US staff. The New York-based company is covering health insurance through Sept 30 for the former employees.

BuzzFeed's efforts to reduce costs have also included pay cuts through the end of the year and breaking real estate leases in certain locations. The measures are expected to keep the company's losses for the year under US$20 million (S$27.7 million). At the start of the year, the company expected to turn a profit of about US$30 million.

Many media companies are struggling during the pandemic with the sudden loss of revenue from advertising and other businesses, like live events.

While some turned to furloughs and pay cuts, layoffs have become unavoidable as the crisis drags on. Last week, Vox Media, home of the Verge, Eater and New York magazine, cut about 72 jobs, while The Guardian said it will dismiss about 180 employees. In June, The New York Times cut 68 jobs, largely in advertising. In May, Vice Media culled 155 employees, while The Atlantic cut 68 positions, including many who worked in live events.

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