BuzzFeed News is shutting down, CEO Jonah Peretti said in a memo Thursday.
The move to shutter the digital news outlet includes additional plans to cut the company’s workforce by 15% across its business, content, tech and administrative units, Peretti said in the memo, posted online by New York Times media reporter Ben Mullin. He said the company can “no longer afford to fund” the news section as a standalone organization amid declining readership.
The shutdown will shift the company’s news efforts to HuffPost, which it bought in 2021. “We will concentrate our news efforts in HuffPost, a brand that is profitable with a highly engaged, loyal audience that is less dependent on social platforms,” Peretti said in the memo. Some BuzzFeed news staffers will be moved, he said, and the company is in discussions with the News Guild over editorial roles.
Peretti included a long explanation for what happened to the news site in his memo. “We’ve faced more challenges than I can count in the past few years,” he said, citing the pandemic, the disappointing launch of its stock through a SPAC deal as that market faded, the tech recession and the tough economy, including the declining digital advertising market and ongoing audience and platform shifts. “Dealing with these obstacles at once is part of why we’ve needed to make the difficult decisions to eliminate more jobs and reduce spending,” he said.
The company had previously cut its staff by 12% in December, the latest string of layoffs over recent years.
“I could have managed these changes better,” Peretti admitted in his memo. “Our job is to adapt, change, improve and perform despite the challenges in the world. We can and will do better.”
He pointed specifically to the integration of BuzzFeed and digital lifestyle publisher Complex Networks, which it bought in 2021, and said that process “should have been executed faster and better.”
“The macro environment is tough, but we had the potential to generate much more revenue than we delivered over the past 12 months,” he wrote.
“Over the next couple of months we will work together to run a more agile and focused business organization with the capacity to bring in more revenue,” he continued.
The company pulled in $436.7 million in revenue in 2022, up about 10% year-over-year, but it still posted a $200 million, or $1.45 per share, loss for the year, reversing a $24.7 million profit for 2021.
Last month, the company warned that it expected revenue in the first quarter to drop by more than 30% from last year and more than 50% from the 2022 fourth quarter. The company is slated to report its first-quarter results on May 9.
Peretti also blamed himself for “the decision to overinvest in BuzzFeed News because I love their work and mission so much. This made me slow to accept that the big platforms wouldn’t provide the distribution or financial support required to support premium, free journalism purpose-built for social media.”
He said he regrets that “I didn’t hold the company to higher standards for profitability, to give us the buffer needed to manage through economic and industry downturns and avoid painful days like today.”
The company “exhausted” other cost-saving measures before cutting staff and closing the news site, he said.
BuzzFeed.com, the lifestyle and listicle site, will continue to operate. The company got a lift from news earlier this year that it would be using AI-generated stories on the site.
“It might not feel this way today, but I am confident the future of digital media is ours for the taking,” Peretti said. “Our industry is hurting and ready to be reborn. We are taking great pains today and will begin to fight our way to a bright future.
Two C-level executives, CRO Edgar Hernandez and COO Christian Baesler are exiting the company in conjunction with the broader cuts, Peretti said. President Marcela Martin will take on responsibility for all revenue functions and Andrew Guendojoian was named the new head of sales for the U.S.
“I have great confidence in this revenue leadership team, and the early plans I’ve seen from them to accelerate performance from our business org,” Peretti said.
BuzzFeed’s beaten-down shares plunged another 22 cents in midday trading, to 71 cents. The stock dropped below the crucial $1 mark on Tuesday.