BuzzFeed Founder and CEO Jonah Peretti
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BuzzFeed announced Tuesday that it is shrinking news agencies that are losing money.
Some major shareholders have urged BuzzFeed CEO Jonah Peretti to shut down the entire news operation, people who asked not to be named because the discussion was private, said. BuzzFeed declined to comment.
BuzzFeed News, part of the content division, employs about 100 people and loses about $ 10 million annually. The company, which also has an advertising and commerce division, said Tuesday that full-year content revenue increased 9% to $ 130 million in 2021.
One shareholder said CNBC’s closure of the newsroom could add up to $ 300 million in market capitalization to its struggling stock. The digital media company was released in December through a special purpose acquisition company. Stocks fell nearly 40% immediately in the first week of trading and have not recovered.
BuzzFeed’s share price plummeted around Tuesday after the company reported earnings and the story was published.
Peretti has long supported the importance of BuzzFeed News, saying it’s good for the world, for business, and for corporate culture. The organization’s newsroom has won several awards, including the Pulitzer Prize and the George Polk Awards.
“This morning we announced plans to accelerate BuzzFeed News’ profitability, including leadership changes, the addition of a dedicated business development group, and planned power reductions,” Peretti said on Tuesday. .. “We prioritize investment in the biggest news of the day, culture and entertainment, celebrities, and coverage of life on the Internet.”
read more: According to BuzzFeed, people spend less time on Facebook
The company offered a voluntary acquisition to less than 30 employees, according to someone familiar with the issue that asked them not to be named because the decision was private. Buyouts cover research, inequality, politics or science and are only available to reporters and editors who have worked for the company for over a year. BuzzFeed will make a takeover offer to the NewsGuild of NewYork for US staff.
Peretti is trying to increase the profitability of the department rather than shutting down BuzzFeed News. He has a ready-made template. He decided to dismiss 70 HuffPost staff last year after acquiring the company from Verizon Media.
“BuzzFeed is a profitable company, but we don’t have the resources to support the loss for another two years,” Peretti said at the time. “The most responsible thing we can do is manage costs and make sure BuzzFeed (and HuffPost) are set to prosper in the long run, so we achieve profitability faster. We made the difficult decision to rebuild the HuffPost because of it. Our goal is for the HuffPost to reach the break-even point again this year. “
According to people familiar with the organization, the HuffPost is now profitable.
Editor-in-chief departs
Prior to the dismissal, BuzzFeed News editor-in-chief Mark Schoofs told staff today that he would leave the company. Samantha Henig, Strategy Editor-in-Chief of BuzzFeed News, will temporarily run the newsroom.
Deputy Editor-in-Chief Tom Namako and Ariel Kaminar, Editor-in-Chief of the Survey, I am also resigning.Sea cucumber Participate in NBC News Digital Operations As editor-in-chief.
Buzzfeed said in its fourth-quarter revenue release, quarterly revenue reached $ 146 million, up 18% year-on-year. Profit increased 29% year-on-year to $ 41.6 million.
Full-year revenue was $ 398 million, up 24% year-on-year. Net income more than doubled last year to $ 25.9 million.
See: Why is BuzzFeed so volatile after being published via SPAC?
Disclosure: NBC and CNBC are divisions of NBC Universal.