After less than a month: Weeks does not keep its promise not to lay off employees

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Was quick to vehemently deny that it would lay off employees due to the weak results, and today it turns out that the company will actually part with some of its employees as part of its waiver of the move to turn its subsidiary Wix Answers into an independent company. At this stage, it is estimated that in the first stage the scope of layoffs will be limited, and will include only dozens of employees, most of whom are sales people.

In an interview with BizPortal Following the publication of the reports, Lior Shemesh, CFO, said: “We have invested in our activities in the last 3 years to create new activities, we have completed these investments but that does not mean we are going to fire, but we will not recruit at the same pace to establish the new developments. I’m telling you this unequivocally and you can quote me – we did not get rid of even one employee, on the contrary. We will be recruited. We will not recruit thousands of employees but we will definitely increase the number of employees in the company. Look at the amount of employees today and the amount of employees that will be at the end of the year. We do not need to do that when we have 1.5 billion in cash. ”

But now it turns out that the estimates were not really accurate and the company decided to close the start-up, which aims to help manage the user support system. BizPortal has learned that the move will include the dismissal of a few dozen of the company’s employees, most of them sales people, with the software people expected to be integrated into the company’s operations.

The announcement today comes, among other things, against the background of the company’s weak reports, which were reflected, among other things, in the share price, which has fallen by 51% since the beginning of the year. In the first quarter of the year, the company posted revenue of $ 342 million, slightly above analysts’ expectations of $ 340.55 million. Bottom line the company reported a non-GAAP adjusted loss per share of 72 cents, worse than analysts expect a loss of 64 cents per share. It lost $ 41 million in the quarter on a non-GAAP basis and on a GAAP basis the loss was $ 227 million.

The warning light had already appeared in reports when the company went into a $ 2.48 million capital deficit, compared to a positive equity of $ 145.7 million in the corresponding quarter. That is, she is in fact in danger of not being able to pay her debts. The company also hinted that it would work for “operational efficiency.” But the company chose to blame those who understood that this meant that it would have no choice but to fire employees for distortion.

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