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FaZe Clan allegedly lays off 20% workforce

FaZe Clan lays off many employees as its stock price continues to fall in 2023. The esports industry is... Maria | 18. February 2023

FaZe Clan lays off many employees as its stock price continues to fall in 2023.

The esports industry is facing tough times, with famous brands like 100 Thieves, Team Liquid, and OpTic Gaming laying off dozens of employees in the first weeks of 2023.

FaZe Clan joins the list of companies in a difficult situation. FaZe Clan has reportedly laid off approximately 20% of its employees. This comes as the company’s share price with the online gaming and entertainment brand continues to plummet, down 93.10% in value since its IPO in July 2022.

Layoff process at FaZe Clan

Earlier this week, employees were reportedly notified during a general meeting that the layoff process concludes this February. Since December 2022, workers have been laid off gradually, with “approximately 20%” of the total workforce no longer part of the company.

Importantly, this wave of layoffs appears to be related to FaZe Clan’s continued difficulties as a publicly traded company. Its share price has fallen below $ 1 and is in danger of delisting now because of its share price. As previously discussed, since the brand went public, its value has declined by 93.10%.

FaZe Clan CEO Comments

FaZe Clan CEO Lee Trink commented:

“We must understand that today we operate in a completely different economic environment than we did even when we went public. This reorientation, coupled with greater economic uncertainty, has led us to reduce our employee base. As a result, we expect the 2022 revenue growth report to show an increase of more than 25% compared to 2021. While changes like this are always difficult, I am confident that this new structure, accompanied by a much greater focus on financial discipline and the holistic strategy we outlined at the AGM, will put the company in a better position for us to capitalize on the many opportunities ahead.”

On the other hand, Lee Trink says the initial intention was to raise “a lot more capital” by going public. FaZe Clan apparently contracted based on these potential outcomes before signing contracts and entering into agreements because that funding was planned to provide new opportunities.

However, the team has now been re-examining the breadth of its expansion strategy in light of the existing balance sheet due to the sharp stock market decline.

Lee Trink adds:

“This re-focus, plus more uncertainty in the overall economy, has led us to reduce our employee base.”

Clearly, the esports industry is facing challenging times, and FaZe Clan has become yet another victim of the stock market slump. In addition, the company’s decision to lay off a significant portion of its employees results from difficulties. While the news is undoubtedly disheartening, the company has had to make this tough decision. This way, it focuses on its growth strategy and balance sheet.

Header: FaZe Clan