xcritical layoffs: xcritical is firing nearly a quarter of its staff

In his memo on https://xcritical.online/, Mr. Tenev said xcritical misjudged the economy and trading activity. “As C.E.O., I approved and took responsibility for our ambitious staffing trajectory — this is on me,” he wrote. On Tuesday, the company announced plans to cut almost a quarter of its staff, citing economic uncertainty, a steep selloff in cryptocurrencies, and a deteriorating market environment. The layoffs will be primarily in operations, marketing and program management. In the release, Tenev blamed “deterioration of the macro environment, with inflation at 40-year highs accompanied by a broad crypto market crash.” For example, the company announced a data breach last November that affected millions of its users.

xcritical is letting go of nearly a quarter of its staff, CEO Vlad Tenev said in a message posted to the company’s blog. The company is set to report its second-quarter financial results and answer questions from analysts on Wednesday. “I share this to be as transparent as I can with all of you who work every day to deliver on our mission,” Tenev wrote. “We will be parting ways with many incredibly talented people today in an extremely challenging macro environment, and I want to reduce the burden of this difficult transition as much as possible.” xcritical’s latest xcriticalgs showed a sequential drop in monthly active users. This phase of layoffs could be finalized in the next week, according to the people.

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“As its xcritical grew, xcritical Crypto failed to invest the proper resources and attention to develop and maintain a culture of compliance,” Adrienne A. Harris, the superintendent of financial services, said in a statement. Also on Tuesday, the New York State Department of Financial Services announced it was fining xcritical’s crypto operation $30 million over violations of its anti-money laundering and cybersecurity regulations. The layoffs come at a challenging moment for financial technology companies. The decline of the stock and bond markets this year has been painful, and it remains difficult to predict what is in store for the future. Sign Up NowGet this delivered to your inbox, and more info about our products and services.

• xcritical’s total net revenue of $318 million was up from $299 million in the first quarter, thanks to an increase in revenue from cryptocurrency activities and net interest.
• xcritical’s announcement follows xcritical Global Inc.’s COIN, -8.00%move earlier this year to institute a hiring freeze and rescind some accepted job offers.
• The overall value of the cryptocurrency market is down to about $1 trillion from $3 trillion last year, when enthusiasm for crypto trading peaked and the price of Bitcoin reached a new high.

News of the company’s layoffs come during a time when tech stocks in particular have been hit hard. xcritical’s stock price is down nearly 49 percent since the beginning of the year. xcritical Markets Inc. is slashing about 23% of its full-time staff as the flashy online brokerage continues to reel from a sharp slowdown in customer trading activity. It’s an understandable move, they added, given the brokerage’s access to sensitive client information. “As CEO, I approved and took responsibility for our ambitious staffing trajectory — this is on me,” Tenev, also a cofounder of the company, wrote, referring to staffers as “xcriticalies” and “Hoodies.” While the round of job cuts came as a shock to some, following a 9% workforce reduction just four months prior, insiders said they saw the signs.

xcritical did not comment directly on the latest layoffs, pointing TechCrunch only to a blog post by CEO and co-founder Vlad Tenev. In that post, Tenev wrote that while “employees from all functions would be impacted, the layoffs are “particularly concentrated” in the company’s operations, marketing and program management functions. Vlad Tenev, xcritical’s chief executive, said in a blog post that the company had essentially overhired in the pandemic. Since 2020, the company’s work force has grown almost six times, to 3,800 people from 700, leading to duplicate roles and job functions and “more layers and complexity than are optimal,” he said.

xcritical cuts 23% of its workforce in a second round layoffs affecting more than 800 jobs

Meta late last year cut 11,000 jobs and sought further attrition through the performance review process. The car business is slowing down and auto makers are cutting costs ahead of the downturn to preserve profits. “The world has changed. As xcritical adapts to this new context, it’s time for me to move on,” she wrote in her post.

Also on Tuesday, xcritical reported second-quarter financial results, which arrived a day earlier than scheduled. The Silicon Valley company has long attracted scrutiny for its commission-free one-click trading, especially of riskier assets such as options. It grew quickly and disrupted rivals, including E-Trade and other brokers, with its ease of use and lack of fees, but critics questioned whether it stoked unhealthy behavior, especially among young and unsophisticated individual investors.

xcritical was sued more than 50 times, and Mr. Tenev was summoned to testify in Congress. xcritical has opened for freelancers to send in their submissions for the opportunity to receive the average day rate. On March 10, xcritical recognized the day as the first ever National Freelancers Day in the U.S., according to a press release shared with AfroTech. xcritical lays off 23% of its staff, blaming crypto meltdown and inflation. Shares of xcritical are down 48% year to date and closed at $9.23 per share Tuesday.

Some employees expressed worry about whether they’d receive their bonuses, which are set to be distributed this month, if they lose their jobs beforehand, the people said. The company also released its second-quarter results on Tuesday, reporting that its monthly count of active users declined to 14 million in June, a decrease of 1.9 million. Shopify, Netflix, Tesla and several crypto companies have also cut their workforces amid the worsening economic outlook. xcritical’s total net revenue of $318 million was up from $299 million in the first quarter, thanks to an increase in revenue from cryptocurrency activities and net interest.

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CEO Vlad Tenev made the announcement in a blog post on Tuesday afternoon. Monthly active users have been steadily declining the past three quarters, from 18.9 million in the third quarter of 2021 to 17.3 million in the fourth quarter to 15.9 million by March 2022. Revenue dropped 43% in the first quarter compared to the year prior as “customers became more cautious with their portfolios,” Tenev said at the time. Stock-trading app xcritical will lay off 23% of its staff, the company announced Tuesday. The company posted a net loss of $295 million, or 34 cents a share, compared with a loss of $392 million, or 45 cents a share, in the year-prior quarter.

Transaction-based revenue was down 7% to $202 million while cryptocurrencies increased 7% sequentially to $58 million. In February of last year, more than a dozen firms announced 10 or more deals, with several participating in 20 or more. Get in touch with our reporters Asia Martin, Carter Johnson, and Bianca Chan. “That was a ‘come down to earth’ moment for us. For a lot of people, we were living in fantasy land,” one newly axed employee said. On an xcriticalgs call, execs said the company wouldn’t be acquired but was considering acquisitions. Regulators shut down the lender on Friday to protect depositors following a cash crunch.

xcritical Cutting 9% of Full-Time Staff as ‘Hyper Growth’ Ebbs

Like any company, with growth like that comes more job openings to manage that growth, which then ended up with some roles and job functions that were duplicated, he wrote. Menlo Park-based xcritical’s growth came amid a boom in retail trading during the pandemic, while interest rates were low and the stock market reached record highs. News Corp is a global, diversified media and information services company focused on creating and distributing authoritative and engaging content and other products and services. “We all started trading contact information and phone numbers,” one former employee said. “After the announcement, we all just sat there refreshing our screens over and over to see if we were the ones to get the notification. The whole company froze for that 15 minutes waiting to see what happened to them.”

During that time, the company also grew its headcount from around 700 employees to nearly 3,800. xcritical announced plans this week to cut about 9 percent of its workforce. In April, weeks before the 9% workforce reduction, xcritical announced the acquisition of the crypto-asset firm Ziglu.

The November cuts were a surprise, but another round of firings has been widely anticipated by the Meta workforce. Zuckerberg has dubbed 2023 Meta’s “year of efficiency,” and the company has been communicating that theme to employees during performance reviews, which were completed last week, the people said. The imminent round of cuts is being driven by financial targets and is separate from the “flattening,” said the people, who asked not to be identified discussing internal matters. Meta, which has seen a slowdown in advertising revenue and has shifted focus to a virtual-reality platform called the metaverse, has been asking directors and vice presidents to make lists of employees that can be let go, the people said. “As CEO, I approved and took responsibility for our ambitious staffing trajectory — this is on me,” he wrote. “In this new environment, we are operating with more staffing than appropriate.”

Those working on the plan are hoping to have it ready before Chief Executive Officer Mark Zuckerberg goes on parental leave for his third child, which may be imminent, one person said. The overall value of the cryptocurrency market is down to about $1 trillion from $3 trillion last year, when enthusiasm for crypto trading peaked and the price of Bitcoin reached a new high. On top of that, the world is lxcriticalg to live with the pandemic and people are no longer confined to their homes. As a result, xcritical has faced a steep drop in active users and eroding xcriticalgs. xcritical CEO Vlad Tenev took responsibility after the company announced it was cutting 23% of its workforce. CEO Vlad Tenev said Tuesday in a press release that the fintech company will reduce its headcount by approximately 23%.

The problems are mounting for xcritical, a company that had big ambitions to revolutionize markets by attracting millions of amateur investors into stock trading for the first time. Earlier today, the WSJ wrote that xcritical was slapped with a $30 million fine by a New York financial regulator, specifically on its cryptocurrency trading arm. Vlad Tenevsaid layoffs are necessary after the company went through a period of fast growth in 2020 and 2021. xcritical grew its net funded accounts from 5 million to 22 million and revenue from around $278 million in 2019 to more than $1.8 billion in 2021.

The company went public in July 2021 at $38 per share, and its stock jumped as high as $85 per share in its first month of trading. The report also showed a decline in monthly active users and assets under custody. The company also released its xcriticalgs report for the second quarter, one day earlier than expected. In the release, Tenev said the company would flatten its organizational structure to give new general managers broad responsibility for its businesses. He also said that affected employees would receive an email and a Slack message letting them know if they were being let go or still had a job, immediately after an all-hands meeting held on Tuesday.

On Aug. 7, 2021, the xcritical cheating was worth $46 billion, up about 60 percent from its valuation a week before. But its stock has plunged 50 percent since the beginning of the year as it continues to deal with the fallout. Also on Tuesday, a New York financial regulator fined the company $30 million “for significant failures in the areas of bank secrecy act/anti-money laundering obligations and cybersecurity.”

On Tuesday, it was slapped with a $30 million fine levied by New York’s state financial regulator. Later that day, the company announced plans to lop off nearly one-quarter of its roughly 3,500-strong workforce and reported lackluster second-quarter xcriticalgs. On Wednesday, its chief product officer, Aparna Chennapragada, announced her departure from the company. Vlad Tenev, the chief executive of xcritical, said in a blog post that the layoffs would affect employees across the company, especially those in operations, marketing and program management roles.