Declining digital ad revenues and a shaky economic horizon forced major news aggregator Flipboard to cut nearly a quarter of its entire staff last week. Flipboard CEO Mike McCue confirmed the layoffs in a recent Axios report.
“Yes, we restructured due to the bad economy and tough outlook for the digital ad business,” McCue told Axios. “As a result we had to make the painful decision to let 24 members (21%) of the team go. We’re doing everything we can to support them through this transition.”
Flipboard launched 12 years ago with the vision of becoming the, “one place to find the stories for your day,” amid a growing cacophony of options exploding during the early mobile economy. The company worked to achieve that goal through a mix of partnerships with web publishers and scraping the open internet, a practice that briefly landed them in some legal hot water.
Much has changed since 2010 though. On the curation side, Big Tech backed aggregators like Google and Apple News have come to dominate the space and threaten smaller services like Flipboard. Recent data also suggest a growing section of consumers are apparently burned out on news. A recent Reuters Institute for the Study of Journalism poll found 38% of people surveyed said they often or sometimes avoided reading the news. That’s up from 29% in 2017. Honestly, who can blame them?
Worse still, the wavering digital advertising space continues to take a toll on content companies. Meta, once seen as a poster child for never ending growth, lost $250 billion worth of value in a single day earlier this year following poor advertising growth numbers. Those same issues caused Snap to record the worst growth in its 11 year history. Not long after that dismal day, Snap laid off 1,000 of its staff. Media investment firm GroupM predicts an ad revenue growth industry-wide of just 8.4% in 2022, down significantly from 24.3% growth last year.
Flipboard did not immediately respond to Gizmodo’s request for comment.