Automattic, the parent company of WordPress.com, is cutting approximately 16% of its workforce in an effort to secure its long-term future, CEO Matt Mullenweg announced in a memo on the company’s website.
Before the layoffs, Automattic employed 1,777 people. The company’s updated headcount now stands at 1,495, meaning around 280 employees were affected by the job cuts.
The decision comes amid an ongoing legal battle with WP Engine, a third-party hosting company. Last year, WP Engine sued Automattic and Mullenweg, accusing them of blocking WP Engine from WordPress.org’s servers and taking over the Advanced Custom Fields (ACF) plugin. Mullenweg has expressed concerns that the lawsuit could last for years and might even lead to the closure of WordPress.org.
In October, Automattic offered employees $30,000 or six months’ salary as a voluntary buyout for those who disagreed with its handling of the dispute with WP Engine. That round of buyouts resulted in a workforce reduction of about 8.4%.
“We have reached an important crossroads,” Mullenweg stated in his memo. “While our revenue continues to grow, Automattic operates in a highly competitive market, and technology is evolving at unprecedented levels. To support our customers and products, we must improve our productivity, profitability, and capacity to invest.”