BuzzFeed, a popular internet media company based in New York, is slashing its news division as several key shareholders have urged Founder and CEO Jonah Peretti to shut it down entirely.
The shareholders have told Jonah Peretti that the entire news operation must be shut down as the newsroom, which reportedly loses Buzzfeed about $10million a year while some top editors are leaving, reports The Daily Mail.
The departures include Mark Schoofs, editor in chief, Tom Namako, deputy editor in chief, and Ariel Kaminer, executive editor for Investigations of BuzzFeed.
During BuzzFeed's earnings call on Tuesday, CEO Jonah Peretti stated that the company is increasing its investment in vertical video, which is popular on apps such as TikTok.
A meeting that was recorded and leaked to Business Insider, where Peretti took a more realistic approach with what was happening to his news division.
By the time staffers were allowed to ask questions, multiple reporters said that Peretti had already left the meeting.
They didn't stop staffers from unleashing on the remaining executives who were in the meeting.
'This is the exact opposite of the message we got from Mark [Schoofs],' one employee said. 'We have been pushed toward longer form, less reactive news for two years, and now I'm hearing the exact opposite. I don't understand beyond the shareholders not liking news what the real problem is here.'
Another noted Peretti's absence at the Q&A: 'This is very frustrating, and it's very rude that Jonah left,' said another employee. 'It's f--king disrespectful. All of this is really disheartening and hurtful. This is why we have a f--king union. You can't just treat people like this.'
Another staffer had similar concerns: 'To be told by Jonah - who has now left the meeting, which everyone is obviously really upset about - that he's not going to subsidize us as if we're a charity case in this company, is insulting. Morale is such a problem.'
Samantha Henig, Buzzfeed's VP of News Strategy and Operations, said that they have to balance journalism with making a profit.
'We're faced right now with a decision about how to continue to serve our audience, do great journalism that makes the world better, and do it within a business model that lets us cover our costs now so that we can continue to grow and invest in the future,' Henig said.
As for the news division, it 'will need to get smaller,' and 'prioritize the areas of coverage our audience connects with most,' Peretti said in a memo to employees.
On the earnings call, he said that the company needs to make BuzzFeed News 'a stronger financial contributor to the larger business,' and doing so will involve focusing on big breaking news, culture and entertainment, celebrities, and 'life on the internet.'
Peretti said the strategy will now be 'the biggest news and scoops of the day, the best coverage of the internet, culture, our own lives, our health, and faster investigations,' according to the audio.
Rosalind Adams, an investigative reporter at BuzzFeed News, tweeted: 'We've had freedom to chase wild, impossible stories. It's a sad day to watch @BuzzFeedNews move away from valuing that work.'
Beyond the newsroom buyouts, the company also said it is cutting 1.7 percent of its staff.
In a January filing with securities regulators, Buzzfeed said it had 1,524 US and international employees, so the cuts would amount to roughly 25 people.
BuzzFeed's shares have dropped more than 40 percent since the company went public in early December via what's known as a SPAC, merging with a company that already trades, rather than an IPO.
The company had a solid year in 2021, it reported Tuesday in its earnings release. Its revenue rose 24 percent to $397.6 million, thanks to increases in e-commerce and ad revenue, and its profit more than doubled, to $25.9million.
But it expects revenue to drop in the current quarter if it includes the acquisition of Complex Networks, a group of pop culture sites BuzzFeed acquired last year.
The layoffs separate from the news division will come from BuzzFeed Video and the editorial side of Complex.
BuzzFeed also acquired HuffPost in early 2021, and laid off several dozen of its staffers shortly after.
The last direct layoffs of Buzzfeed staffers came in July of 2020, when the company laid off 70 percent of its furloughed workers.
Shares in Buzzfeed Inc. rose 32 cents, or 6.5 percent, to close Tuesday at $5.27.