The media meltdown continues, with BuzzFeed being the latest company to slash its workforce.
The digital media company says that it will cut its workforce by 16 percent amid a challenging environment for media companies.
“Digital publishers are facing multiple headwinds in the current market, and our recent revenue performance reflects the fact that a bundled portfolio approach is not aligned with current advertiser or platform trends,” BuzzFeec CEO Jonah Peretti wrote in an email to staff Wednesday. “More importantly, our performance does not reflect the value or future growth potential of our individual brands. The changes we are making to reduce the size of our business and administrative teams will position each brand to operate more autonomously. Moving forward, we will focus on bringing each of our brands to market with a focus on their differentiation for our advertising and platform partners.”
BuzzFeed also said Wednesday that it would sell Complex to the livestream shopping platform NTWRK for $108.6 million plus $5.7 million earmarked for office and severance costs. BuzzFeed will retain First We Feast under the deal.
The new layoffs come almost a year after BuzzFeed shed its staff by 15 percent and shut down BuzzFeed News, focusing all of its news content in HuffPost. On Wednesday the company also announced a new structure, with BuzzFeed, HuffPost, First We Feast and Tasty operating as their own business lines “with individual strategies and revenue lines tailored to market and audience dynamics.”
The specific details of the new restructuring will be released on Feb. 28 (that is also when employees will be notified), though the company says it expects annualized cost savings of $23 million under the plan. Peretti said in his email that HuffPost, Tech, BuzzFeed Studios, Tasty, First We Feast (including Hot Ones), and International will not be impacted by the cuts, which will total a little under 160 people.
The company will use the cash from the Complex sale to pay down its debt obligations and put itself on stronger financial footing moving forward.
“The changes we announced today will enable an exciting next stage for our company, with increased focus on our iconic brands — BuzzFeed, HuffPost, First We Feast and Hot Ones, and Tasty; a more efficient cost structure and operational model; and the ability to accelerate innovation powered by AI and interactive content formats,” Peretti said in a statement. “I look forward to sharing more in the coming months.”
And BuzzFeed also warned investors that its fourth-quarter revenues will be in the $73-$78 million range, compared to the financial outlook of $99 million to $110 million that it shared in November.
“During the fourth quarter our experiential business was impacted in the form of lower sponsorship revenues for the brand’s annual flagship event, ComplexCon, we believe as a result of the Complex asset being held for sale,” said BuzzFeed CFO Matt Omer in a statement. “Further, our overall revenue performance reflects the challenges of delivering against our bundled go-to-market strategy in a tighter digital advertising market. As a result, we have made the decision to reduce the size of our centralized operations enabling our individual brands to operate with more autonomy and deliver against their differentiated value propositions for advertisers.”
The cuts at BuzzFeed come amid a tumultuous media market, as Omer alluded to in his statement.
The Washington Post, Los Angeles Times, Time, The Messenger, Condé Nast, Sports Illustrated, Business Insider, Paramount, Forbes, The Wall Street Journal, New York Daily News, National Geographic and The Baltimore Sun have all undergone layoffs or seen labor strife in recent weeks, with business models in turmoil and advertising (at least for media outlets and linear TV) still in a state of crisis.