We’ve been hearing about these PayPal layoffs, and today the company confirmed this in a blog post today. Due to a product org redesign, 325 full-time roles (and employees) have been terminated. PayPal is also ending contracts with approximately 120 contractors globally.
From the blog post: So we’ve been redesigning our product organization, collapsing nine product groups into one. We are creating agile teams of designers, engineers and product managers. Instead of being organized around projects, our teams will now be dedicated to products and focused on our customers — consumers, developers, small businesses and large retailers.
According to a release, the cuts will result in a fourth quarter pretax restructuring charge of approximately $15 million.
You can read more about about PayPal’s new product strategy here.
The company’s President, David Marcus, cautions that these layoffs are more a reflection of the reorganization, and that the business is “strong and performing well.” eBay and PayPal just posted strong earnings a few weeks ago. PayPal ended the quarter with 117.4 million active registered accounts, a 14% increase over the third quarter of 2011. Revenue increased 23% year over year, to $1.4 billion, and net total payment volume (TPV) grew 20% year over year to $35.2 billion.
Clearly, revenue and payments volume is increasing, so financially, PayPal seems to be in good shape. As Marcus told us a few weeks ago, he’s reorganizing the organization, particularly in product and engineering, into a more lean, and agile company when it comes to innovation and product development. Basically, he wants PayPal to operate more like a startup. While we’ll be waiting to see if the reorganization will actually translate into more innovative products coming from the payments giant, it’s clear that Marcus has a vision for PayPal and is executing on that strategy. Stay tuned.