FaZe Clan is cutting 40% of its remaining staff amid the financial crisis
The future of FaZe Clan doesn't look well
When discussing eSports Orgs, the name that comes to everyone’s mouth is probably FaZe Clan. Formed in 2010, FaZe clan is one of the oldest Orgs in the eSports industry. FaZe Clan has achieved success in a variety of games, including Call of Duty, Counter-Strike: Global Offensive, Fortnite, and PUBG. The organization has won numerous championships and has become a household name in the gaming and entertainment industry. However, for more than a year, things have not been going in the right direction for FaZe Clan. In 2022, the company went public with a $725 million valuation, and its current stock price remains below $1. Losing in the last CSGO Major, 2023 Blast.TV Paris Major, in just the quarter-finals. And now critics are heavily criticizing it for laying off 40% of its staff.
The current eSports sector economic crisis uses FaZe as an example. This is because their books are now publicly available. FaZe claimed $53 million in losses for the year 2022 despite modest sales growth. This downfall has been going on for a while now. The company is also facing a delisting threat from Nasdaq due to its stock price. The company is dealing with a lot of difficult issues, and it’s conceivable that it won’t be able to recover.
Founded in 2010 by three Call of Duty players. The clan quickly became known for its trick-shot videos. In 2014, FaZe Clan expanded into the competitive gaming scene. Since then, they have won numerous championships. Today, FaZe Clan is one of the most popular esports organizations in the world. However, fame comes with a cost, and the cost bore by FaZe Clan has been quite heavy for a year now.
FaZe Clan Lays Off 40% of their staff
The eSports Org’s current stock price and downfall is the major reason for this layoff. The Dexerto report states that the company’s personnel was informed of the layoffs at 10:01 am on May 19. FaZe laid off around 20% of its workforce in February of this year, making this the second round of layoffs the firm has undergone in 2023. Recent SEC filings from FaZe for the first quarter of 2023 revealed yet another losing quarter for the business. FaZe reported a financial loss of $14.04 million at that time due to a 20% reduction in sales from the fourth quarter of 2022.
Snoop Dogg, the famous rapper, was a content creator and board member of FaZe Clan. His withdrawal from the Org in March damaged it further. According to FaZe’s 2022 fourth-quarter filings, the well-known rapper and businessman quit the organization on March 29 “effective immediately.” The Org responded to the allegations on Twitter by stating that an SEC filing would be released later today detailing the employee decrease. Faze also said,
“This plan shows the latest progress from our efforts to align our cost structure with our focused near-term priorities around brand sponsorship and esports growth, as discussed in our shareholder letters. In the last several months we have executed on material cost reductions to protect capital and we will continue to work toward putting FaZe in the best possible position to drive towards future profitability,”
As of right now, FaZe Clan‘s future is very uncertain. It’s quite disheartening to see such a big Org crumble down so badly. Fans are dejected over this development. All fans can hope for right now is for FaZe to turn over a new leaf. There has been no irreversible damage yet, and the clan can bounce back again with clear and efficient logistical work.
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