Airbnb has announced today a 25% reduction in its workforce - impacting nearly 1,900 of its 7,500 employees - as a result of the effects of the COVID-19 crisis.
In a letter to employees, co-founder and CEO Brian Chesky calls the coronavirus outbreak “the most harrowing crisis of our lifetime” and explains how it has taken a toll on Airbnb’s business - with revenue for 2020 forecasted to be less than half of what it earned in 2019.
Although Airbnb managed to secure $2 billion in capital amid the outbreak, Chesky says “two hard truths” - that no one knows when travel will return and what travel will look like - indicated further measures needed to be taken.
In addition to the layoffs, Chesky says changes to the business will include pausing efforts in its transportation department and in Airbnb Studios; the company will also scale back investments in its Hotels and Lux categories.
He adds that teams across all of Airbnb will be impacted, and “many teams will be reduced in size based on how well they map where Airbnb is headed.”
“To those leaving Airbnb, I am truly sorry. Please know this is not your fault. The world will never stop seeking the qualities and talents that you brought to Airbnb…that helped make Airbnb. I want to thank you, from the bottom of my heart, for sharing them with us,” Chesky ends his letter.
His apology is not the first in recent weeks: In March, Chesky apologized to hosts for botching communication about Airbnb’s coronavirus-related cancellation policy, resulting in the company donating $250 million to assist.
The coronavirus has had a particularly harsh impact on the home-share giant, which was slated to list on the public markets in 2020, as its hosts scramble to pay mortgages, guests can’t or are hesitant to travel and industry experts reevaluate the value of private accommodation.
As newer elements of its business are set to the side – namely, Hotels, led by Airbnb’s acquisition of HotelTonight in March 2019 and its ongoing push around flights and transportation – it appears the company is not only scaling back its workforce, but also its purpose.