Zoom will lay off 1,300 employees and its CEO will accept a large salary cut

(CNN) — Zoom said Tuesday it will lay off about 1,300 employees, or about 15% of its staff, becoming the latest technology company to announce major job cuts as the surge in demand for digital services caused by the pandemic subsides. .

In a memo to employees, Zoom CEO Eric Yuan said the layoffs would affect every part of the organization. Yuan also said he and other executives would take a significant pay cut, after acknowledging that he made “mistakes” in how quickly the company grew during the pandemic.

“As the CEO and founder of Zoom, I am responsible for these mistakes and the actions we take today, and I want to show responsibility not just with words but with my own actions,” he wrote. “To that end, I will reduce my salary for the next fiscal year by 98% and forego my FY23 corporate bonus.”

Yuan said members of the executive leadership team will cut their base salaries by 20% for the next fiscal year and lose their fiscal 2023 bonuses.

Zoom shares rose nearly 9% in midday trading on Tuesday after the announcement.

Zoom, more than most companies, came to define the early days of the pandemic, as many turned to its platform to video chat with friends and colleagues during lockdowns. In mid-2020, Zoom reported revenue skyrocketing, an increase fueled by the growing number of business customers for the many companies forced to turn to remote work.

Yuan said the company hired “quickly” during the early days of the pandemic to support booming demand. “In 24 months, Zoom grew 3x in size to handle this demand while allowing for continued innovation,” Yuan wrote.

However, Zoom’s shares declined significantly last year as more workers returned to office life.

Zoom is far from the only pandemic darling platform to see a sharp drop. Peloton, for example, has gone through several rounds of layoffs. Much of the technology companies, which grew rapidly during the pandemic, have also announced layoffs since then.