After over ten years in operation, BuzzFeed has pulled the plug on its news division.
What happened: CEO and co-founder Jonah Peretti told staff the move is part of a 15% workforce reduction affecting almost every team, per NBC. "We’ve determined the company can no longer continue to fund BuzzFeed News as a standalone organization," he wrote.
- In 2021, BuzzFeed News won a Pulitzer Prize for a series exposing China’s mass detention of Muslims. But still, the division has not been able to turn a profit.
- Since going public—also in 2021—BuzzFeed has never traded above its initial public offering price of about US$10 and has fallen by about ~84% in the last year.
Why it matters: Economic times are tough. All companies are taking a hard look at what they’re investing resources into and deciding if it aligns with their long-term goals. If it’s not making money, or doesn’t have a clear path toward making money, it’s not a good sign.
- Media outlets have been hit especially hard by challenges to profit from their content. ABC News, NPR, Insider, and Vox Media have all recently laid off staff.
Zoom out: The rise of generative AI has complicated things further. Insider and BuzzFeed have been experimenting with ChatGPT to help write articles (including some questionable SEO-driven travel content and quizzes), but deny that any jobs will be replaced by AI.—SB