Stripe lays off 14% of workers

Published

3 years ago

November 3, 2022

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Online payments giant Stripe is laying off roughly 14% of its staff, CEO Patrick Collison wrote in a memo to staff Thursday.

In the memo, Collison said the cuts were necessary amid rising inflation, fears of a looming recession, higher interest rates, energy shocks, tighter investment budgets and sparser startup funding. Taken together, these factors signal “that 2022 represents the beginning of a different economic climate,” he said.

Collison acknowledged that the company’s leadership made “two very consequential mistakes” by misjudging how much the internet economy would grow in 2022 and 2023, and when it grew operating costs too quickly.

Technology companies have been announcing layoffs and hiring freezes while moving to cut costs amid a worsening economic outlook. Amazon, Google parent Alphabet and Facebook owner Meta have all taken steps to rein in expenses. Companies including Netflix, Spotify, Coinbase and Shopify have announced layoffs.

San Francisco-based Stripe became the most valuable U.S. startup last year, with a valuation of $95 billion, though it reportedly lowered its internal valuation in July to $74 billion amid economic uncertainty and a prolonged tech rout, according to The Wall Street Journal. It processes billions of dollars in transactions each year from the likes of Amazon, Salesforce and Google, and it competes with Square and PayPal.

Stripe said its headcount will be reduced to about 7,000 employees, which means the layoffs impact roughly 1,100 people. A Stripe spokesperson was not immediately available to provide the exact number of impacted employees.

The cuts will affect many of Stripe’s divisions, though most will occur in recruiting, as the company plans to hire fewer people next year, Collison said in the memo.

In addition to laying off staff, Stripe intends to rein in costs across the company, Collison said.

Earlier today, Stripe CEO Patrick Collison sent the following note to Stripe employees.

Hi folks —

Today we’re announcing the hardest change we have had to make at Stripe to date. We’re reducing the size of our team by around 14% and saying goodbye to many talented Stripes in the process. If you are among those impacted, you will receive a notification email within the next 15 minutes. For those of you leaving: we’re very sorry to be taking this step and John and I are fully responsible for the decisions leading up to it.

We’ll set out more detail later in this email. But first, we want to share some broader context.

The world around us

At the outset of the pandemic in 2020, the world rotated overnight towards e-commerce. We witnessed significantly higher growth rates over the course of 2020 and 2021 compared to what we had seen previously. As an organization, we transitioned into a new operating mode and both our revenue and payment volume have since grown more than 3x.

The world is now shifting again. We are facing stubborn inflation, energy shocks, higher interest rates, reduced investment budgets, and sparser startup funding. (Tech company earnings last week provided lots of examples of changing circumstances.) On Tuesday, a former Treasury Secretary said that the US faces “as complex a set of macroeconomic challenges as at any time in 75 years”, and many parts of the developed world appear to be headed for recession. We think that 2022 represents the beginning of a different economic climate.

Our business is fundamentally well-positioned to weather harsh circumstances. We provide an important foundation to our customers and Stripe is not a discretionary service that customers turn off if budget is squeezed. However, we do need to match the pace of our investments with the realities around us. Doing right by our users and our shareholders (including you) means embracing reality as it is.

Today, that means building differently for leaner times. We have always taken pride in being a capital efficient business and we think this attribute is important to preserve. To adapt ourselves appropriately for the world we’re headed into, we need to reduce our costs.

How we’re handling departures

Around 14% of people at Stripe will be leaving the company. We, the founders, made this decision. We overhired for the world we’re in (more on that below), and it pains us to be unable to deliver the experience that we hoped that those impacted would have at Stripe.

There’s no good way to do a layoff, but we’re going to do our best to treat everyone leaving as respectfully as possible and to do whatever we can to help. Some of the core details include:

Severance pay. We will pay 14 weeks of severance for all departing employees, and more for those with longer tenure. That is, those departing will be paid until at least February 21st 2023.
Bonus. We will pay our 2022 annual bonus for all departing employees, regardless of their departure date. (It will be prorated for people hired in 2022.)
PTO. We’ll pay for all unused PTO time (including in regions where that’s not legally required).
Healthcare. We’ll pay the cash equivalent of 6 months of existing healthcare premiums or healthcare continuation.
RSU vesting. We’ll accelerate everyone who has already reached their one-year vesting cliff to the February 2023 vesting date (or longer, depending on departure date). For those who haven’t reached their vesting cliffs, we’ll waive the cliff.
Career support. We’ll cover career support, and do our best to connect departing employees with other companies. We’re also creating a new tier of extra large Stripe discounts for anyone who decides to start a new business now or in the future.
Immigration support. We know that this situation is particularly tough if you’re a visa holder. We have extensive dedicated support lined up for those of you here on visas (you’ll receive an email setting up a consultation within a few hours), and we’ll be supporting transitions to non-employment visas wherever we can.

Most importantly, while this is definitely not the separation we would have wanted or imagined when we were making hiring decisions, we want everyone that is leaving to know that we care about you as former colleagues and appreciate everything you’ve done for Stripe. In our minds, you are valued alumni. (In service of that, we’re creating alumni.stripe.com email addresses for everyone departing, and we’re going to roll this out to all former employees in the months ahead.)

We are going to set up a live, 1-1 conversation between each departing employee and a Stripe manager over the course of the next day. If you are in an impacted group, look out for a calendar invitation.

For those not affected, there’ll be some bumpiness over the next few days as we navigate a lot of change at once. We ask that you help us do right by Stripe’s users and the departing Stripes.

Our message to other employers is that there are many truly terrific colleagues departing who can and will do great things elsewhere. Talented people come to Stripe because they’re attracted to hard infrastructure problems and complex challenges. Today doesn’t change that, and they would be fantastic additions at almost any other company.

Going forward

In making these changes, you might reasonably wonder whether Stripe’s leadership made some errors of judgment. We’d go further than that. In our view, we made two very consequential mistakes, and we want to highlight them here since they’re important:

We were much too optimistic about the internet economy’s near-term growth in 2022 and 2023 and underestimated both the likelihood and impact of a broader slowdown.
We grew operating costs too quickly. Buoyed by the success we’re seeing in some of our new product areas, we allowed coordination costs to grow and operational inefficiencies to seep in.

We are going to correct these mistakes. So, in addition to the headcount changes described above (which will return us to our February headcount of almost 7,000 people), we are firmly reining in all other sources of cost. The world is hard to predict right now, but we expect that these changes will set us up for robust cash flow generation in the quarters ahead.

We are not applying these headcount changes evenly across the organization. For example, our Recruiting organization will be disproportionately affected since we’ll hire fewer people next year. If you want to see how your organization is impacted, Home will be up-to-date by 7am PT.

We’ll describe what this means for our company strategy soon. Nothing in it is going to radically change, but we’re going to make some important edits that make sense for the world that we’re headed into, and tighten up our prioritization substantially. Expect to hear more on this over the next week.

While the changes today are painful, we feel very good about the prospects for innovative businesses and about Stripe’s position in the internet economy. The data we see is consistent with this encouraging picture: we signed a remarkable 75% more new customers in Q3 2022 than Q3 2021, our competitive win rates are getting even better, our growth rates remain very strong, and on Tuesday we set a new record for total daily transaction volume processed. Our smaller users (many of whom are just “big customers that aren’t yet big”) are, in aggregate, growing extremely quickly, showing that plenty of technology S curves remain in the early innings and that our customers remain impressively resilient in the face of the broader global challenges.

People join Stripe because they want to grow the internet economy and boost entrepreneurship around the world. Times of economic stress make it even more important that we find innovative ways to help our users grow and adapt their businesses. Today is a sad day for everyone as we say goodbye to a number of talented colleagues. But we’re ready for a pitched effort ahead, and we’re putting Stripe on the right footing to face it.

For the rest of this week, we’ll focus on helping the people who are leaving Stripe. Next week we’ll reset, recalibrate, and move forward.

Patrick and John

This news is developing. Please check back for updates.

Technology

CNBC Daily Open: There’s a hopeful mood in the Middle East and the markets

Published

4 hours ago

October 14, 2025

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CNBC Daily Open: There's a hopeful mood in the Middle East and the markets

U.S. President Donald Trump speaks while World leaders listen during a summit of European and Middle Eastern leaders on Gaza on October 13, 2025 in Sharm El-Sheikh, Egypt.

Chip Somodevilla | Getty Images

This might not be Christmas, but the war in the Middle East is over — at least according to U.S. President Donald Trump.

On Monday, Trump declared at the Knesset, Israel’s parliament, that the “long and painful nightmare” was finally over for both the Israelis and Palestinians. More straightforwardly, Trump gave an unequivocal “yes” when asked by reporters if the war in the Middle East has ended, Reuters reported.

A similarly hopeful mood permeated markets, though for different reasons. After hitting China with 100% additional tariffs and triggering a sell-off on Friday, Trump appeared to walk back his stance, posting on Truth Social that “it will all be fine” with China.

And thus was TACO back on traders’ menus: Major U.S. stock indexes rebounded, with technology stocks leading the charge. Quantum computing names popped after JPMorgan Chase announced it will be investing $10 billion in sectors crucial to national interests.

Broadcom, meanwhile, surged almost 10% after it jointly announced a partnership with — who else? — OpenAI to build and deploy custom chips. But where this puts Nvidia, OpenAI’s other near and dear one, and on whose chips the ChatGPT maker relies, remains a question.

Though Christmas has yet to arrive, OpenAI is starting to look like the tech sector’s Santa Claus.

— CNBC’s Holly Ellyatt contributed to this report.

What you need to know today

War in the Middle East is over, Trump says. At Israel’s parliament, Trump gave a speech in which he said that the “long and painful nightmare” for both the Israelis and Palestinians was over. He also urged, at a separate event, for leaders to put “old feuds” behind.

Broadcom joins the OpenAI party. The two companies announced Monday that they’re planning to develop and deploy OpenAI-designed chips, amounting to 10 gigawatts, starting late next year. Shares of Broadcom popped almost 10% on the news.

JPMorgan says it will invest $10 billion in critical industries. The four areas of focus — which the bank considers crucial to U.S. security — are: defense and aerospace, “frontier” technologies such as AI, energy technology and supply chain and advanced manufacturing.

Stocks claw back some losses. On Monday stateside, major U.S. stock indexes rose, rebounding from Friday’s carnage. The S&P 500 regained 56% of Friday’s decline. Europe’s Stoxx 600 index climbed 0.44%, lifted by mining stocks.

[PRO] European sectors less affected by trade war. The continent isn’t in the crosshairs of Trump’s latest tariffs, but a weakening U.S. dollar could affect Europe’s exports. UBS picks three sectors more shielded from that — leaving out a notable one.

And finally…

U.S. President Donald Trump shakes hands with Argentina’s President Javier Milei during the 80th United Nations General Assembly, in New York City, New York, U.S., Sept. 23, 2025.

Alexander Drago | Reuters

The U.S. has stepped in with an extraordinary bailout of Argentina. Here’s what it means

In a move that Treasury Secretary Scott Bessent announced Thursday on social media site X, the U.S. is providing a $20 billion currency swap line with Argentina’s central bank — essentially exchanging stable U.S. dollars with volatile pesos.

The move comes amid liquidity concerns in Argentina that threatened stability for the country as it faces key midterm elections. There are equal parts economic and political stakes with the venture, which marks the first U.S. intervention of this nature since rescuing Mexico in 1995.

— Jeff Cox

Technology

Amazon fires employee who was suspended for protesting company’s work with Israel

Published

5 hours ago

October 14, 2025

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Amazon fires employee who was suspended for protesting company's work with Israel

A woman cleans the store window of the Amazon house after activists sprayed paint on its logo during a protest on the opening day of the 55th annual meeting of the World Economic Forum in Davos, Switzerland, on Jan. 20, 2025.

Yves Herman | Reuters

Amazon fired a Palestinian engineer who was suspended last month after he protested the company’s work with the Israeli government.

Ahmed Shahrour, who worked as a software engineer in Amazon’s Whole Foods business in Seattle, received an email on Monday informing him of his termination. When he was suspended in September, Amazon said the decision was the result of messages Shahrour posted on Slack criticizing the company’s ties to Israel.

Amazon said its investigation found Shahrour had violated the company’s standards of conduct, written communication policy and acceptable use policy, alleging that he “misused company resources, including by posting numerous non-work-related messages pertaining to the Israel-Palestine conflict.”

“In the next 24hrs you will receive an email with detailed information about your termination, including information about your benefits and final pay,” an Amazon human resources employee wrote in a message to Shahrour that was obtained by CNBC. “We appreciate the contributions you’ve made during your time with Amazon and wish you the best in your future endeavors.”

An employee group associated with Shahrour put out an afternoon press release saying that he was fired after a five-week suspension “for protesting Amazon’s $1.2 billion contract with the Israeli government and military, known as Project Nimbus, which he states constitutes collaboration in the ongoing genocide in Gaza.”

Shahrour had urged the company to drop the contract that involves Amazon providing the Israeli government with artificial intelligence tools, data centers and other infrastructure. He also protested and handed out flyers at Amazon’s downtown Seattle headquarters.

In a statement to CNBC, Shahrour said his firing is “a blatant act of retaliation designed to silence dissent from Palestinian voices within Amazon and shield Amazon’s collaboration in the genocide from internal scrutiny.”

President Trump addresses Israel's Knesset as Hamas releases hostages held in Gaza

Amazon spokesperson Brad Glasser told CNBC in a statement that the company doesn’t tolerate “discrimination, harassment or threatening behavior or language of any kind in our workplace.”

“When any conduct of that nature is reported, we investigate it and take appropriate action based on our findings,” Glasser said.

Shahrour’s termination comes on the same day that Palestinian militant group Hamas released the first seven surviving Israeli hostages, marking the first stage of a ceasefire deal brokered with the help of U.S. President Donald Trump. As part of the agreement, Israel was also scheduled to free nearly 2,000 Palestinian detainees and prisoners later in the day.

The war started just over two years ago, when Hamas-led militants attacked southern Israel on Oct. 7, 2023, killing roughly 1,200 people and taking hundreds of hostages. Israel followed with a sustained assault that killed more than 67,000 Palestinians, including thousands of civilians, according to Gaza’s Health Ministry.

Across the tech industry, workers have become more outspoken in their criticism of business dealings with the Israeli military.

On Thursday, a Microsoft engineer resigned after 13 years at the software giant, claiming the company continues to sell cloud services to the Israeli military and that executives won’t discuss the war in Gaza. Scott Sutfin-Glowski, a principal software engineer, informed colleagues in a letter that, “I can no longer accept enabling what may be the worst atrocities of our time.”

In the letter, he referred to a February Associated Press article that said Israel’s military had at least 635 Microsoft subscriptions, and he claimed the vast majority of them remain active.

Microsoft fired two employees in August who participated in a protest inside the company’s headquarters. In April 2024, Google terminated 28 employees after a series of protests against labor conditions and its involvement in Project Nimbus.

Amazon hasn’t acknowledged the Nimbus contract beyond stating that it provides technology to customers “wherever they are located.” Google has previously said it provides generally available cloud computing services to the Israeli government that aren’t “directed at highly sensitive, classified or military workloads.” Microsoft said in August that most of its work with Israel Defense Forces involves cybersecurity for the country, and that the company intends to provide technology in an ethical way.

— CNBC’s Jordan Novet contributed to this report.

WATCH: Is a ceasefire in Gaza sustainable?

Is a ceasefire in Gaza sustainable? Israel ambassador to UAE talks regional peace

Technology

Broadcom CEO says generative AI will become a much larger part of global GDP

Published

7 hours ago

October 13, 2025

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Broadcom CEO says generative AI will become a much larger part of global GDP

The main competitor we have is merchant silicon, says Broadcom CEO Hock Tan

Broadcom CEO Hock Tan told CNBC’s Jim Cramer on Monday that artificial intelligence could become a larger part of global GDP as the technology spreads across industries.

Tan said the current global GDP sits around $110 trillion, with 30% of that figure “valued from industries related to knowledge-based, technology-intensive.”

“And you put in generative AI, you create intelligence in a lot of other aspects of society,” Tan continued. “That 30% say will grow to 40% of all GDP. That’s $10 trillion a year.”

If AI grows and becomes responsible for a larger piece of global GDP as Tan predicts, it would be a boon to the nascent tech sector and all the industries it relies on. Broadcom makes chips and networking equipment and has been a huge beneficiary of the AI boom as hyperscalers buy up its products. The stock is currently up 53.86%.

Broadcom and OpenAI announced their official partnership on Monday, saying they would jointly build and deploy 10 gigawatts of custom artificial intelligence accelerators. The move is part of a broader effort to scale AI across the industry. Broadcom shares surged in response to the news, up 9.88% by market close.

Broadcom and OpenAI’s deal is the latest in a slew of pricey partnerships among key Big Tech players related to AI.

Tan said OpenAI is “one of those few players in the forefront of creating foundation models,” and noted that even as a private company, the ChatGPT maker is worth about $500 billion. According to Tan, Broadcom’s “hard-nosed” approach to business doesn’t keep the company from looking several years in the future “at this phenomenon, this wave called generative AI.”

Broadcom is tight-lipped about its customers, but said earlier this year it was developing new AI chips with three large cloud customers. Management announced last month it had secured $10 billion in chip orders from a fourth unnamed client.

Tan told Cramer that Broadcom is working closely with “about seven players,” four of which he defined as “real customers,” or ones “who have given us production purchase orders at scale.”

“We feel very good about it,” Tan said of Broadcom’s partnerships. “Because each of these guys need a lot of compute capacity for them to basically play in this game and eventually win this game of creating the best foundation model in the world.”