10 Companies That Are Announcing Layoffs

According to the jobs numbers, the economy is still strong with an unemployment rate under 4%. However, there are a number of signs that the economy is weakening, including declining consumer confidence, and a number of tech companies are beginning to scale back on hiring and even lay off employees in some cases.

Keep reading to see 10 companies that are letting employees go -- even after many of them experienced breakneck growth during the pandemic.

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It's no secret that the crypto boom has gone south. Bitcoin is down about 70% from its peak last November, and non-fungible token valuations are falling fast as well. Terra, once a top-10 cryptocurrency with a market cap of $40 billion, has imploded; cryptocurrency bank Celsius is on the verge of collapse; and crypto hedge fund Three Arrows Capital was forced to liquidate after suffering billions in losses from the crypto collapse.

Not surprisingly, this has weighed on exchanges like Coinbase (NASDAQ: COIN), the largest crypto exchange in the U.S., which has seen transactions drop and profits plunge.

In a recent blog post, CEO Brian Armstrong said the company would lay off 18% of its staff, or 1,100 employees, as it steels itself for another crypto winter.

ALSO READ: What Is Cryptocurrency?

Netflix (NASDAQ: NFLX) was another poster child for the pandemic winners as its subscriber base surged in the early months of the crisis.

However, the leading video streamer seemed to underestimate the rise of competition and the slowdown in growth that would follow the boom.

As a result, the company overinvested in new content and hired too many people. It's since announced several rounds of layoffs, most recently dismissing 300 employees in June after letting go of another 150 in May. With growth now sputtering, Netflix's focus on the bottom line isn't surprising.

One of the earliest signs of trouble from pandemic darlings came from Peloton Interactive (NASDAQ: PTON).

Demand for the connected fitness company's equipment and classes soared during the pandemic, but as the economy reopened, interest quickly faded.

However, the company planned for the opposite, investing in new manufacturing capacity and ramping up marketing spending.

When growth didn't follow, the stock collapsed and CEO John Foley was ushered out. In the process, 2,800 employees lost their job.

Carvana (NASDAQ: CVNA), the leading online used car seller, has been a volatile stock throughout its history, and the used car market has faced a number of challenges during the pandemic, including a shortage of new and used cars and elevated prices.

The car market ground to a halt in the early days of the pandemic before gaining momentum later on.

Carvana, which has grown rapidly over history but remains unprofitable, has struggled to navigate the pandemic era. It recently said it would lay off 2,500 people, as it overestimated growth in the used car market.

ALSO READ: Carvana Is Down 90%. Here's Why It's a Buy

Like Coinbase, Robinhood (NASDAQ:HOOD) benefited from a surge in stock and crypto trading during the pandemic, which led to its IPO.

However, that has quickly faded and Robinhood has experienced a similar decline in transaction volume and weakness on the bottom line.

As a result, Robinhood is also scaling back its growth plans, saying it would lay off 300 people, or 9% of its staff. Similar to Coinbase, Robinhood also blamed overly rapid growth for the decision.

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Though apparel sellers were mostly struggling during the pandemic, Stitch Fix stock jumped as it continued to grow its user base and benefited from hopes that its Freestyle service would revolutionize the company.

That hasn't happened, however, and growth has ground to a halt. As a result, the stock has plunged, and the company is now in cost-cutting mode. That includes laying off 15% of salaried staff, or 330 people, as the company announced in June.

Real estate is another industry that boomed during the pandemic as housing prices skyrocketed.

However, mortgage rates jumped as the Federal Reserve hiked benchmark interest rates, which has put the brakes on the housing market.

As a result, real estate tech firms like Redfin (NASDAQ: RDFN) have also had to scale back their growth plans. The company announced that it would lay off 8% of its staff, or roughly 470 employees.

ALSO READ: The 3 Smartest Real Estate Stocks to Buy Right Now

It's not just tech companies that are experiencing layoffs.

Even the financial giants are cutting back in some areas. JPMorgan Chase (NYSE: JPM) said it would lay off hundreds of employees in its mortgage division, citing cyclical changes in the mortgage market.

Housing prognosticators believe the housing cycle is just to beginning to contract, and with mortgage rates likely to go up even further, we could see more such layoffs like this in real estate, mortgage lending, and related industries.

Even some of the fastest-growing companies aren't immune to the layoff bug. Tesla (NASDAQ: TSLA) was one of the biggest winners during the pandemic, but recently announced that it's laying off 200 people in its autopilot division.

CEO Elon Musk also said in June that the company would lay off 10% of its workforce over the next few months as he anticipates headwinds from a slowing economy. Tesla has also faced production challenges in China over COVID-19 lockdowns.

Buy now, pay later (BNPL) companies have also seen their valuations shrink in recent months along with the broader sell-off in fintech stocks.

Among the victims has been Klarna, a privately held Swedish BNPL company that was forced to slash its valuation from $45 billion to $15 billion.

In May, the company said it planned to lay off 10% of its workforce and announced plans to raise to funds at a valuation that was just a third of its prior round.

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CEOs and economists are increasingly calling for a recession in recent weeks, and the Federal Reserve is expected to continue aggressively hiking interest rates, which will put the brakes on the economy.

However, no one knows where the economy is going for sure, and there are signs that expectations of a slowdown are already starting to bring inflation under control as oil prices are at their lowest level in several weeks and the housing market is starting to normalize.

Keep an eye out for more layoffs as they offer some of the best indicators of the companies and industries that are suffering the most.

JPMorgan Chase is an advertising partner of The Ascent, a Motley Fool company. Jeremy Bowman has positions in Netflix, Redfin, and Stitch Fix. The Motley Fool has positions in and recommends Bitcoin, Coinbase Global, Inc., Netflix, Peloton Interactive, Redfin, Stitch Fix, and Tesla. The Motley Fool recommends the following options: short August 2022 $13 calls on Redfin. The Motley Fool has a disclosure policy.