Airbnb lays off a quarter of its staff - 1,900 people around the world - after losing more than half its revenue due to coronavirus travel decline

• CEO Brian Chesky announced the cuts in a letter to staff on Tuesday  
• He said the company was projected to make less than half what it did last uear 
• Airbnb has 7,500 employees in more than 24 countries around the world 
• It is unclear which departments will see cuts; Chesky said employees would be given 14 weeks pay when they are laid off 
• Those being laid off were told they'd receive a 'departure meeting' Google calendar invite
• Those staying but getting new roles would receive a 'new role meeting' calendar invite, Chesky
• Chesky, worth an estimated $4.1billion, said he was 'truly sorry' for having to let so many staff go 
• Airbnb was due to go public in 2020  

Airbnb has announced that it is laying off 25 percent of its workforce, some 1,900 employees around the world, as a result of the crippling effect coronavirus has had on travel.  

In a letter to employees that has since been posted on the company's website, chief executive Brian Chesky said the company is letting 1,900 of its 7,500 workers go and cutting businesses that do not directly support home-sharing, such as its investments in hotels and movie production.

Those leaving will work until Monday May 11, he said.  

All workers will receive 14 weeks base pay as severance and in the US, workers will receive an extra week's pay for every year they served the company. 

'Workers are being allowed to keep their laptops, he said, and will be helped to find new jobs.  

'We are collectively living through the most harrowing crisis of our lifetime. 

'Airbnb’s business has been hit hard, with revenue this year forecasted to be less than half of what we earned in 2019,' Chesky, who was worth around $4billion last year, said.   

It is unclear which divisions will be hit hardest. 

Airbnb CEO Brian Chesky announced the cuts on Wednesday 

Some staying on would be given new roles, he said. 

Those leaving were told to expect a calendar invite titled 'departure meeting', whereas those getting new jobs were told to expect one titled 'new role meeting'. 

Part of CEO Brian Chesky's note to Airbnb employees on Tuesday afternoon 

Those able to keep their jobs were told to expect no email invitation. 

US employees will continue to receive health care coverage for a year; in other countries, employees will keep their health coverage through the end of this year.

The company had hoped to stave off laying off staff by raising $2billion in capital and cutting costs at the start of the pandemic. 

Now, Chesky said, the future of travel is remains too uncertain for them to keep going.  

The company will now return to its roots of focusing on home-sharing experiences that are closer to people's own homes to try to adapt to the new world of travel. 

Chesky, who is worth an estimated $4.1billion according to Forbes, finished the note: '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'S FULL MEMO TO STAFF 

This is my seventh time talking to you from my house. Each time we’ve talked, I’ve shared good news and bad news, but today I have to share some very sad news.

When you’ve asked me about layoffs, I’ve said that nothing is off the table. Today, I must confirm that we are reducing the size of the Airbnb workforce. For a company like us whose mission is centered around belonging, this is incredibly difficult to confront, and it will be even harder for those who have to leave Airbnb. I am going to share as many details as I can on how I arrived at this decision, what we are doing for those leaving, and what will happen next.

Let me start with how we arrived at this decision. We are collectively living through the most harrowing crisis of our lifetime, and as it began to unfold, global travel came to a standstill. Airbnb’s business has been hit hard, with revenue this year forecasted to be less than half of what we earned in 2019. In response, we raised $2 billion in capital and dramatically cut costs that touched nearly every corner of Airbnb.

While these actions were necessary, it became clear that we would have to go further when we faced two hard truths:

While we know Airbnb’s business will fully recover, the changes it will undergo are not temporary or short-lived. Because of this, we need to make more fundamental changes to Airbnb by reducing the size of our workforce around a more focused business strategy.

Out of our 7,500 Airbnb employees, nearly 1,900 teammates will have to leave Airbnb, comprising around 25% of our company. Since we cannot afford to do everything that we used to, these cuts had to be mapped to a more focused business.

A more focused business

Travel in this new world will look different, and we need to evolve Airbnb accordingly. People will want options that are closer to home, safer, and more affordable. But people will also yearn for something that feels like it’s been taken away from them — human connection. When we started Airbnb, it was about belonging and connection. This crisis has sharpened our focus to get back to our roots, back to the basics, back to what is truly special about Airbnb — everyday people who host their homes and offer experiences.

This means that we will need to reduce our investment in activities that do not directly support the core of our host community. We are pausing our efforts in Transportation and Airbnb Studios, and we have to scale back our investments in Hotels and Lux.

These decisions are not a reflection of the work from people on these teams, and it does not mean everyone on these teams will be leaving us. Additionally, teams across all of Airbnb will be impacted. Many teams will be reduced in size based on how well they map to where Airbnb is headed.

How we approached reductions

It was important that we had a clear set of principles, guided by our core values, for how we would approach reductions in our workforce. These were our guiding principles:

I have done my best to stay true to these principles.

Process for making reductions

Our process started with creating a more focused business strategy built on a sustainable cost model. We assessed how each team mapped to our new strategy, and we determined the size and shape of each team going forward. We then did a comprehensive review of every team member and made decisions based on critical skills, and how well those skills matched our future business needs.

The result is that we will have to part with teammates that we love and value. We have great people leaving Airbnb, and other companies will be lucky to have them.

To take care of those that are leaving, we have looked across severance, equity, healthcare, and job support and done our best to treat everyone in a compassionate and thoughtful way.

Severance

Employees in the US will receive 14 weeks of base pay, plus one additional week for every year at Airbnb. Tenure will be rounded to the nearest year. For example, if someone has been at Airbnb for 3 years and 7 months, they will get an additional 4 weeks of salary, or 18 weeks of total pay. Outside the US, all employees will receive at least 14 weeks of pay, plus tenure increases consistent with their country-specific practices.

Equity

We are dropping the one-year cliff on equity for everyone we’ve hired in the past year so that everyone departing, regardless of how long they have been here, is a shareholder. Additionally, everyone leaving is eligible for the May 25 vesting date.

Healthcare

In the midst of a global health crisis of unknown duration, we want to limit the burden of healthcare costs. In the US, we will cover 12 months of health insurance through COBRA. In all other countries, we will cover health insurance costs through the end of 2020. This is because we’re either legally unable to continue coverage, or our current plans will not allow for an extension. We will also provide four months of mental health support through KonTerra.

Job support

Our goal is to connect our teammates leaving Airbnb with new job opportunities. Here are five ways we can help:

Here is what will happen next

I want to provide clarity to all of you as soon as possible. We have employees in 24 countries, and the time it will take to provide clarity will vary based on local laws and practices. Some countries require notifications about employment to be received in a very specific way. While our process may differ by country, we have tried to be thoughtful in planning for every employee.

In the US and Canada, I can provide immediate clarity. Within the next few hours, those of you leaving Airbnb will receive a calendar invite to a departure meeting with a senior leader in your department. It was important to us that wherever we legally could, people were informed in a personal, 1:1 conversation. The final working day for departing employees based in the US and Canada will be Monday, May 11. We felt Monday would give people time to begin taking next steps and say goodbye — we understand and respect how important this is.

Some employees who are staying will have a new role, and will receive a meeting invite with the subject “New Role” to learn more about it. For those of you in the US and Canada who are staying on the Airbnb team, you will not receive a calendar invite.

At 6pm pacific time, I will host a world@ meeting for our Asia-Pacific teams. At 12am pacific time, I will host a world@ meeting for our Europe and Middle East teams. Following each of these meetings, we’ll proceed with next steps in each country based on local practices.

I’ve asked all Airbnb leaders to wait to bring their teams together until the end of this week out of respect to our teammates being impacted. I want to give everyone the next few days to process this, and I’ll host a CEO Q&A again this Thursday at 4pm pacific time.

Some final words

As I have learned these past eight weeks, a crisis brings you clarity about what is truly important. Though we have been through a whirlwind, some things are more clear to me than ever before.

First, I am thankful for everyone here at Airbnb. Throughout this harrowing experience, I have been inspired by all of you. Even in the worst of circumstances, I’ve seen the very best of us. The world needs human connection now more than ever, and I know that Airbnb will rise to the occasion. I believe this because I believe in you.

Second, I have a deep feeling of love for all of you. Our mission is not merely about travel. When we started Airbnb, our original tagline was, “Travel like a human.” The human part was always more important than the travel part. What we are about is belonging, and at the center of belonging is love.

To those of you staying,

One of the most important ways we can honor those who are leaving is for them to know that their contributions mattered, and that they will always be part of Airbnb’s story. I am confident their work will live on, just like this mission will live on.

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.