Nextdoor, the neighborhood-centric social media platform headquartered in San Francisco, is slashing its employee count by a quarter as it looks to weather the economic challenges that have beset social media companies and the tech industry at large.
The company confirmed the employee cutback in a third-quarter earnings report released Tuesday afternoon, with Nextdoor CEO Sarah Friar calling the layoffs “the hardest decision we have had to make as a team.”
In a U.S. Securities and Exchange Commission filing last year, Nextdoor confirmed it employed 704 people. Assuming the number stayed flat, that means 176 Nextdoor employees will get a pink slip. A Nextdoor spokesperson did not provide an exact number but confirmed that almost 200 employees are part of the reduction.
“While our opportunity and belief in the transformative power of community remains unwavering, and our business is financially strong with a healthy balance sheet, we must follow through on our commitment to our shareholders,” Friar said in a statement Tuesday.
Friar said the layoffs—and other cuts—should set the company up to “reach quarterly free cash flow breakeven” by the end of 2025.
Company shares rose 7 cents at the end of the day Tuesday, with its stock sitting at $1.82.
Nextdoor reported a weekly active-user count of 40.4 million, along with $56 million in revenue and a $38 million net loss, in the third quarter of 2023. The layoff round—and other personnel reductions—will save the company up to $60 million a year. It is unclear what severance benefits laid-off workers will receive.
This marks the first round of layoffs at Nextdoor this year but continues a worrisome uptick of layoffs in recent weeks as interest rates remain high and advertising revenue declines.
Joshua Bote can be reached at firstname.lastname@example.org