PayPal is shedding around 2,000 jobs, or 7% of its workers, as the global economy weakens, becoming the latest big tech firm to cut costs.

The online payments company stated in a statement that it was forced to make the decision as it faces “the challenging macro-economic environment.”

President and CEO Dan Schulman wrote in the release that the company has made progress focusing resources on core priorities and right sizing its cost structure, but that there is more work to be done.

“We must continue to change as our world, our customers, and our competitive landscape evolve,”PayPal’s chief executive Dan Schulman said in a statement.

“Change can be difficult – particularly when it includes valued colleagues and friends departing. We will face this head-on together, drawing on the unparalleled scale of our global platform, the strategic investments we have made to strengthen our core capabilities, and the trust and loyalty of our customers.”
Dan Schulman

In its third-quarter earnings report, PayPal beat on earnings and revenue expectations, but shares slid after the company’s Q4 revenue estimate came in behind analysts’ expectations. But PayPal raised EPS guidance for the full fiscal year, saying it’s benefited from “ongoing productivity initiatives.”

During a call with analysts after the company’s Q3 earnings report, acting CFO Gabrielle Rabinovich talked about the company’s projections for 2023.

“We’re operating in an environment where we think we’re going to continue to have inflationary pressures, where real wage growth is going to continue to be negative for a period of time, where discretionary spend will be under pressures.”
Gabrielle Rabinovich

PayPal’s announcement follows tens of thousands of layoffs by technology giants in the last month alone.

This year, Google’s parent company Alphabet, Amazon and Microsoft have announced major job cuts.

Also on Tuesday, Snap– the parent company of social media platform Snapchat, warned that revenue for the three months to the end of March could fall by as much as 10%.

Operating environment to Remain Challenging

“We anticipate that the operating environment will remain challenging, as we expect the headwinds we have faced over the past year to persist throughout Q1,” the company told investors.

After the announcement Snap’s shares fell by almost 15% in extended trade in New York.

At the start of this year, Amazon announced it planned to cut more than 18,000 jobs because of “the uncertain economy” and rapid hiring during the pandemic.

Also this month, Alphabet said it would shed 12,000 jobs, while Microsoft said up to 10,000 employees would lose their jobs.

Last week, Swedish music-streaming giant Spotify said it would cut 6% of its about 10,000 employees, citing a need to improve efficiency.

In another sign of the technology industry slowdown, US computer chip maker Advanced Micro Devices (AMD) on Tuesday reported a 98% fall in net income for the last three months of 2022.

The company also said It expects revenue to drop by as much 10% in the current quarter. However, the figures were better than many investors expected and AMD’s shares rose after the announcement.

In Asia on Wednesday, the world’s second-biggest memory chip maker SK Hynix posted its largest quarterly loss on record.

The South Korean company reported a worse-than-expected 1.7tn won ($1.4bn; £1.1bn) loss for the last three months of 2022, as sales fell by 38%.

The firm pointed to falling computer chip prices and joined rival technology giants as it warned that it expects an industry-wide downturn to worsen in the coming months, before recovering later in the year.

It came after rival Samsung Electronics on Tuesday reported its lowest quarterly profit in eight years.

PayPal is slated to report fourth-quarter earnings after the bell on Feb. 9.