BuzzFeed is shutting down BuzzFeed News because it is not able to turn a profit, according to a memo CEO Jonah Peretti sent to company staff Thursday. The digital publisher is laying off 15% of its employees, or about 180 people, across BuzzFeed News and other divisions.
Going forward, BuzzFeed will concentrate its news efforts in a single profitable news organization — HuffPost, which it acquired from Verizon in 2020, per Peretti’s memo. The company’s flagship BuzzFeed site will remain in place.
“While layoffs are occurring across nearly every division, we’ve determined that the company can no longer continue to fund BuzzFeed News as a standalone organization,” Peretti wrote.
BuzzFeed News launched in 2012 under then-editor in chief Ben Smith. In the memo, Peretti said, “I made 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.”
HuffPost is “a brand that is profitable with a highly engaged, loyal audience that is less dependent on social platforms,” than BuzzFeed News, according to Peretti. (Read the full memo below.)
Peretti also wrote, “we will bring more innovation to clients in the form of creators, AI and cultural moments that can only happen across BuzzFeed, Complex, HuffPost, Tasty and First We Feast.” According to a BuzzFeed spokesperson, no jobs are being replaced by AI. The company recently started using AI to assist in creating some content, including quizzes, and Peretti said the technology would become “part of our core business.”
Alongside the shutdown of BuzzFeed News, chief revenue officer Edgar Hernandez and COO Christian Baesler are leaving the company. BuzzFeed president Marcela Martin will assume responsibility for all revenue functions effective immediately.
According to a BuzzFeed rep, there are ongoing discussions about the future of BuzzFeedNews, but all of BuzzFeed News work will be preserved and available within the BuzzFeed network. The company also is working to ensure any stories currently in the works from the BuzzFeed News team will be published and promoted on BuzzFeed properties as well.
BuzzFeed and HuffPost will be offering roles to a number of BuzzFeed News journalists to match areas where they’re interested in expanding coverage, the rep added.
Karolina Waclawiak, who was named BuzzFeed News’ editor in chief in June 2022, wrote in a tweet, “It was an honor and privilege to lead @BuzzFeedNews. I’ve spent 7+ years of my career working alongside the most talented and generous people in journalism. We changed the culture. We changed laws. Hire them all.”
Waclawiak also shared a portion of the note she sent to the BuzzFeed News staff: “Over the last 8 months we had been successfully diversifying our revenue ― but it wasn’t enough to overcome the larger financial challenges within the company and monetization changes with social platforms like Facebook. I’m deeply sorry about that. I wanted more for you than what is happening now. You deserve better. There is no reason this company couldn’t have built a business around BuzzFeed News far earlier.” She continued, “And while I believe this outcome was avoidable for BuzzFeed News, it’s indicative of a larger crisis facing journalism today. It’s deeply concerning that it seems the only way to have a sustainable news business is to put journalism behind a paywall. The implication is that only people who can afford to pay for it will have access to high-quality information while everyone else will need to parse through the rampant misinformation that is widely shared across social platforms. The consequences of this are dire.”
According to an SEC filing, BuzzFeed expects to incur between $7 million to $11 million in charges related to the layoffs.
Read Peretti’s memo:
Hi all,
I am writing to announce some difficult news. We are reducing our workforce by approximately 15% today across our Business, Content, Tech and Admin teams, and beginning the process of closing BuzzFeed News. Additionally, we are proposing headcount reductions in some international markets.
Impacted employees (other than those in BuzzFeed News) will receive an email from HR shortly. If you are receiving this note from me, you are not impacted by today’s changes. For BuzzFeed News, we have begun discussions with the News Guild about these actions.
As part of today’s changes, both our CRO Edgar Hernandez and COO Christian Baesler have made the decision to exit the company. I’m grateful to both of them for their passion and dedication to Complex and to BuzzFeed, Inc. Christian will be with us through the end of April, and Edgar through the end of May to help with the transition.
Marcela Martin, our President, will take on responsibility for all revenue functions effective immediately. In the US, Andrew Guendjoian is our new Head of Sales, and Ken Blom will continue in his role as Head of Revenue Operations. Globally, International Sales will move under Rich Reid, Head of International and Head of Studio, also reporting to Marcela.
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. We will share more on their plans in the Business All Hands next week (and we are extending an invite company-wide).
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.
While layoffs are occurring across nearly every division, we’ve determined that the company can no longer continue to fund BuzzFeed News as a standalone organization. As a result, we will engage with the News Guild about our cost reduction plans and what this will mean for the affected union members.
HuffPost and BuzzFeed Dot Com have signaled that they will open a number of select roles for members of BuzzFeed News. These roles will be aligned with those divisions’ business goals and match the skills and strengths of many of BuzzFeed News’s editors and reporters. We raised this idea with the News Guild this morning and look forward to discussing it further. Moving forward, we will have a single news brand in HuffPost, which is profitable, with a loyal direct front page audience.
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.
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.
In particular, the integration process of BuzzFeed and Complex, and the unification of our two business organizations, 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.
Additionally, I made 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.
More broadly, I regret 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. Our mission, our impact on culture, and our audience is what matters most, but we need a stronger business to protect and sustain this important work.
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.
I’ve learned from these mistakes, and the team moving forward has learned from them as well. We know that the changes and improvements we are making today are necessary steps to building a better future.
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. 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. We will empower our editorial teams at all of our brands to do the very best creative work and build an interface where that work can be packaged and brought to advertisers more effectively. And we will bring more innovation to clients in the form of creators, AI, and cultural moments that can only happen across BuzzFeed, Complex, HuffPost, Tasty and First We Feast.
It might not feel this way today, but I am confident the future of digital media is ours for the taking. 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.
On Monday we’ll begin to have conversations with each division about the way forward. And in the meantime, I hope you can take time for yourselves this weekend.
Thank you for supporting one another on a difficult day.
