Airbnb to cut 25 per cent of workforce

Airbnb chief executive Brian Chesky has told staff that 1,900 of the company’s 7,500 workers will be dismissed to help stem coronavirus losses

                                

Airbnb is to cut 25 per cent of its workforce and scale back its efforts to attract high-end travellers as it looks to stem its losses from the coronavirus outbreak.

CEO Brian Chesky told staff that 1,900 of the accommodation booking company’s 7,500 workforce would be dismissed as soon as next week.

The company is expecting its revenue for the year to be less than half of what it took in last year, according to a letter sent to staff. Airbnb said it would pause its efforts to integrate transportation options into its app, as well as the development of Airbnb Studios, an in-house unit to produce travel-related content.

It also said it would scale back its investments in hotels and Luxe, its service aimed at high-end rentals.

The company did not disclose how much it expected to save as a result of the cuts, which will affect the Airbnb workforce globally.

The moves announced are in addition to an estimated $800m (£646m €740m), in savings from ceasing all of its marketing.

Airbnb raised $2bn in funding last month, valuing the company at $18bn, a steep drop from its $31bn price at the time of its previous funding round in 2017.

Other travel businesses are also cutting jobs as the coronavirus pandemic has brought global travel to a virtual standstill.

Virgin Atlantic announced that it is to cut more than 3,000 jobs in the UK and end its operation at Gatwick Airport, as it warned it would take up to three years to return to 2019 traffic levels.

The airline will move leisure flying to London Heathrow as well as keep its base at Manchester airport.

The announcement comes after rival British Airways said it could not rule out closing its Gatwick operation.

Virgin currently employs a total of about 10,000 people.

FURTHER READING: Airbnb secures $1bn loan as Covid-19 threatens business

FURTHER READING: Airlines cut flights and jobs over Covid-19 crisis

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