Last week, BuzzFeed CEO Jonah Peretti announced that BuzzFeed News is being shut down, leading to layoffs of about 15% of BuzzFeed staff. The layoffs will affect the company’s business, content, tech and admin teams as well as some staff in international markets. In an email to staff reprinted by CNBC, Peretti said they can no longer fund BuzzFeed News as a standalone operation. They are in talks with the News Guild about their cost reduction plans and how they will impact union members.

HuffPost and BuzzFeed.com have said they may be able to absorb some of the staff from BuzzFeed News. Those roles must align with business goals and “match the skills and strengths of many of BuzzFeed News’s editors and reporters.” The company’s sole news provider will now be HuffPost. BuzzFeed.com will continue its signature clickbait content, including listicles, quizzes, celebrity gossip and more.

Why BuzzFeed News is shutting down

CNBC reports that BuzzFeed News has about 100 employees and the digital news site lost about $10 million a year, according to sources familiar with the matter. BuzzFeed News won a Pulitzer Prize in 2021 for an investigative series about China’s mass detention of Muslims. The news organization was also a finalist in an investigative piece about global banking.

Peretti explained the need to shut BuzzFeed News down this way:

“I want to explain a little more about why we’ve come to these deeply painful decisions. We’ve faced more challenges than I can count in the past few years: a pandemic, a fading SPAC market that yielded less capital, a tech recession, a tough economy, a declining stock market, a decelerating digital advertising market and ongoing audience and platform shifts. Dealing with all of these obstacles at once is part of why we’ve needed to make the difficult decisions to eliminate more jobs and reduce spending,” Peretti said in the staff email.

“But I also want to be clear: I could have managed these changes better as the CEO of this company and our leadership team could have performed better despite these circumstances. Our job is to adapt, change, improve, and perform despite the challenges in the world. We can and will do better,” the CEO added.

Other issues that impacted the overall organization were the slow integration of BuzzFeed and Complex, overinvestment in BuzzFeed News, and Peretti’s failure to impose “higher standards for profitability.”

“Please know that we exhausted many other cost saving measures to preserve as many jobs as possible. We are reducing budgets, open roles, travel and entertainment, and most other discretionary, non-revenue generating expenditures. Just as we reduced our footprint in NYC last year, we will be reducing our real estate in Los Angeles — from four buildings down to one, which saves millions in costs as well as mirrors our current hybrid state of work,” wrote Peretti.

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Other organizational changes

Peretti also advised company staff that chief revenue officer Edgar Hernandez and chief operations officer Christian Baesler have decided to leave the company.

“I’m grateful to both of them for their passion and dedication to Complex and to BuzzFeed, Inc.,” Peretti wrote. “Christian will help us through the end of April, and Edgar through the end of May to help with the transition.”

Marcela Martin, president, is now responsible for all revenue functions, and several other revenue and sales staff changes are being made. Peretti said he will charge more on the company’s plans at an all-hands meeting this week.

“The changes the Business Organization is making today are focused on reducing layers in their organization, increasing speed and effectiveness of pitches, streamlining our product mix, doubling down on creators, and beginning to bring AI enhancements to every aspect of our sales process,” said Peretti.

2022 BuzzFeed layoffs

In December, BuzzFeed laid off about 180 people, or 12% of its workforce as a cost-cutting measure. At that time, Peretti notified employees by email that they were losing their jobs so that BuzzFeed could survive the economic downturn, reports Variety.

“We must adapt, invest in our strategy to serve our audience best, and readjust our cost structure,” Peretti wrote.

In March of last year, three top editors left BuzzFeed News and buyouts were offered to several dozen others, among to cuts of about 1.7% of the company’s workforce.

“This morning we announced plans to accelerate profitability for BuzzFeed News, including leadership changes, the addition of a dedicated business development group, and a planned reduction in force,” said Peretti. “We will prioritize investments around coverage of the biggest news of the day, culture, entertainment, celebrity, and life on the internet.”

Insider Take

Layoffs of any news organization further constrict an already shrinking news industry. While not everyone’s cup of tea, BuzzFeed News holds its own niche – an eclectic mix of serious news stories and clickbait-style headlines. The digital news site largely made money through advertising, subscriptions ($5 a month or $100 per year) and one-time contributions starting at $5. In the current economy, that model isn’t working. Advertising is harder to sell, and subscriptions were a suggestion, not a requirement, so it is hard to imagine they made a serious contribution to BuzzFeed’s financials. The bottom line is that BuzzFeed News was losing money, and they’ve been trying to plug the holes of their sinking ship for a while. The ship has now sunk, and news will shift to HuffPost which we didn’t realize was still in operation.

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