Business news site Quartz has become the latest publisher to succumb to the financial pressures of COVID-19, laying off around 40% of its global workforce.
Uzabase, the Japanese financial intelligence firm that acquired Quartz from Atlantic Media in July 2018, confirmed the business restructuring in a public filing on Thursday (May 14).
It said Quartz' net sales had dropped by a whopping 54.1% year-on-year in the first quarter of 2020—equivalent to a fall of JPY 340 million (US$3.2 million), as many companies, particularly in the US, "have been putting restraints on their advertising expenditures", the company noted.
“Uzabase has made a decision to accelerate efforts to reorganize Quartz’s business and to eliminate any potential future risks at an early stage, which will involve a shift towards a leaner structure through a fundamental business reform focused on restructuring the advertising business (approximately 40% headcount reduction),” according to the notice.
In a note sent to staff, Quartz chief executive Zach Seward said that about 80 roles would be eliminated, as part of drastic cost-cutting measures to deal with "the greatest challenge we have faced as a company". Quartz reportedly had 188 employees at the end of last year.
The layoffs are across "every team in the company", Seward said. It is thought that around 30% of editorial are to be laid off, according to sources close to the matter.
Seward noted that while membership to Quartz "is growing at a record pace" with 17,680 paid subscribers at the end of April, advertising—which still accounts for the bulk of the publisher's revenue—has been "hit very hard by the effects of coronavirus".
He added that the likely recession to follow after the pandemic recedes "could hurt ad revenue for years to come", and said the cost-cutting measures were designed to sustain the business "for years into the future, not just surviving the current crisis".
As well as reducing its headcount, Seward said he will take a 50% pay cut for the remainder of the year, and the rest of the executive team will take a voluntary 20% pay cut. Quartz is also to close its physical offices in London, San Francisco, Hong Kong, and Washington over the next few months as those leases expire, and is exploring how to reduce its rent in New York.
Quartz' move came on the same day that BuzzFeed announced it was dialling back its news operations in Australia and the UK, citing "economic and strategic reasons" during this "difficult period".
Ten employees in the UK have been furloughed and four in Australia have been affected. The publisher said it will no longer cover local news in the two countries, but will serve audiences with relevent English-language news from its other outposts. In the UK, it plans to retain editorial staff who are focused on globally-relevent news across topics such as social news, celebrity, and investigations.
Last week, Campaign broke news that Malaysian publishing house Blu Inc was to shutter completely, putting 200 staff out of work.