Wish laid off 255 employees to cut costs! Did it lose money again in the second quarter?

It is learned that according to foreign media reports, Wish plans to lay off 255 employees before the end of this fiscal year. The company's CEO Joe Yan disclosed the news in a document submitted to the U.S. Securities and Exchange Commission on Tuesday (August 1).

According to the document, the layoff plan was approved by the board of directors last week and is expected to be completed before the end of this fiscal year. The move will affect approximately 160 Wish U.S. employees (41%) and approximately 95 international employees (26%). The laid-off employees will receive a 60-day severance package, including cash payment and reimbursement of medical insurance premiums.

Wish said in the filing that the layoffs "are intended to refocus the company's operations to support the company's ongoing business prioritization efforts, better align resources and improve operational efficiency." A company spokesperson said it would share more information on its earnings call on Thursday.

It is reported that Wish's revenue has declined significantly in recent years. In February last year, Wish announced the appointment of Vijay Talwar as CEO to replace Piotr Szulczewski, the founder and former CEO of Wish, to improve the user experience of the company's consumers and sellers. At that time, the capital market was also optimistic about the arrival of the "new coach" Vijay Talwar. Since the announcement of the appointment of a new CEO, the stock price of Wish's parent company Contextlogic Inc. has soared. However, after 7 months, Vijay Talwar announced his resignation.

In February this year, Joe Yan officially took office as Wish's CEO. After Joe Yan took office, Wish's online business has made some important progress. After French regulators lifted the delisting measures against Wish, Wish returned to the French app store and search engine, and established several international partnerships to reduce shipping pressure.

However, Wish's revenue is still unsatisfactory. In the first quarter of this year, Wish's revenue fell nearly 50% year-on-year, and its net loss widened to US$89 million from US$60 million in the same period last year.

Wish said in a filing on Tuesday that it expects to save $43 million to $46 million in annual operating costs starting in the fourth quarter of 2023 as a result of the layoffs.

The company also expects to incur approximately $8.7 million in non-recurring charges in the third quarter related to WARN Act compliance, severance payments to affected employees worldwide and other reduction costs associated with the layoff program.

Editor ✎ Nicole/

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