FaZe Clan is laying off 40% of its staff in yet another round of staff reductions for the public company, according to a report from Digiday.
FaZe has been criticized from all corners of the gaming and esports communities, including former members of the company, for its decision to go public.
The company went public in 2022 at a $725 million valuation, and its current stock price is stuck below $1.
With its financials public, fans and investors have been able to peek behind the curtain and see how much money the organization has spent and, crucially, how much they are making.
With their books now open for the world to see, FaZe is seen in the esports scene as an illustration of the current economic downturn in the industry. Over the course of 2022, FaZe reported $53 million in losses despite some increases in revenue.
FaZe Clan’s downward spiral continues
As a result of this downturn, FaZe Clan is cutting 40% of its remaining staff, according to a report from Digiday.
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The company’s staff was notified at 10:01 a.m. on May 19 of the layoffs, according to the report.
🚨BREAKING🚨@FaZeClan has laid off 40% of its remaining staff, only months after a 20% layoff in February. If FaZe is shaping up to be the Titanic of esports, this might be the point where it breaks in half on the way down.Read all about it on @Digiday:https://t.co/I5l0tYsb3R
— Alexander Lee (@alexleewastaken) May 19, 2023
This is FaZe’s second wave of layoffs in 2023, as the company let go of about 20% of its staff in February of this year. FaZe released its 2023 first-quarter SEC filings recently, and it showed another quarter of losses for the company. The net loss for FaZe at that time was $14.04 million as its revenue declined about 20% from its 2022 fourth-quarter filing.
The company also lost one of its high-profile heads, Snoop Dogg, in March. The famous rapper and entrepreneur left the company “effective immediately” on March 29, as was revealed in FaZe’s 2022 fourth-quarter fillings.
FaZe has not responded to Dexerto’s request for comment on the report at this time. The company has addressed the report on Twitter, saying the reduction in its workforce will be revealed in an SEC filing later today.
“This plan shows the latest progress from our efforts to align our cost structure with our focused near-term priorities around brand sponsorship and esports growth, as discussed in our shareholder letters. In the last several months we have executed on material cost reductions to protect capital and we will continue to work toward putting FaZe in the best possible position to drive towards future profitability,” FaZe said.