Top ad executives walk out amid report on staff cut plans

A woman stands in front of the Snap Inc. logo on the floor of the New York Stock Exchange (NYSE) as they wait for Snap Inc. to publish its IPO, in New York, NY, U.S., March 2, 2017. REUTERS/Lucas Jackson

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Aug 30 (Reuters) – Snap Inc (SNAP.N) said on Tuesday that its two top advertising executives had left the company, hours after a report revealed that Snapchat’s parent company planned to cut around 20 % of its workforce.

Executives Jeremi Gorman, chief commercial officer, and Peter Naylor, vice president of advertising sales for the Americas, will join Netflix Inc (NFLX.O), the streaming major said.

Snap shares fell 4% in extended trading as Wall Street grew wary of the future of its advertising business, which generates much of its revenue.

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Earlier today, The Verge announced that Snap’s hardware division, responsible for Spectacles and the Pixy camera drone, its team working to help developers build mini-apps and games inside Snapchat and of the social mapping application Zenly, would be affected by the layoffs. (https://bit.ly/3CDfrIu)

The social media company declined to comment on the report.

Tech companies, crypto exchanges and financial firms have cut jobs and slowed hiring as global economic growth weakens due to rising interest rates, runaway inflation and a slump energy in Europe.

Last month, Snap said some advertisers continue to face supply chain disruptions and labor shortages, and many others are facing rising costs amid growing demand. record inflation, which led to a reduction in advertising expenditure. Read more

Shares of the company have lost nearly 39% since reporting results on July 21, contributing to an 80% drop this year.

Gorman will join Netflix as president of global sales, while Naylor will serve as vice president of advertising sales beginning in September, Netflix said in a statement.

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Reporting by Eva Mathews in Bengaluru; Editing by Vinay Dwivedi

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