The online marketplace is facing lower spending after a surge in activity during the Covid-19 pandemic.
Sean Gallup/Getty Images
Shares of eBay were edging down early on Wednesday after the e-commerce marketplace firm said it would cut around 4% of its workforce.
The company (ticker: EBAY) is cutting about 500 jobs, it said Tuesday in a regulatory filing after the close of trading. The company said the move was driven by the macroeconomic situation and its focus on select categories, which are growing quicker than the rest of its business.
“This shift gives us additional space to invest and create new roles in high-potential areas—new technologies, customer innovations and key markets—and to continue to adapt and flex with the changing macro, e-commerce, and technology landscape,” CEO Jamie Iannone said in a message to employees.
Shares of eBay were down 0.7% in premarket trading on Wednesday.
The muted move comes in contrast to video-conferencing company
Zoom Video Communications
(ZM), which closed up nearly 10% on Tuesday after saying it would cut about 15% of its staff, or around 1,300 people.
Tech stocks have generally reacted positively to recent announcements of layoffs, with deeper cuts getting a bigger reaction. Online furniture retailer
Wayfair
(W) has risen more than 40% since saying it would lay off about 10% of its global staff. Stock in crypto exchange
Coinbase
(COIN) has nearly doubled in the past month after it announced nearly 20% of its employees would be cut.
Lower spending is a problem for eBay after a surge in activity during the Covid-19 pandemic. It is expected to report a fall in active buyers to around 133 million for the end of 2022 in its fourth-quarter report later this month, down from 147 million at the same time last year, according to FactSet.
Write to Adam Clark at adam.clark@barrons.com
Credit: marketwatch.com