Online travel agency Expedia Group will be cutting approximately 12% of its workforce, according to a CNN media report. An internal memo seen by The Financial Times and CNN, the travel agency said projects, activities, teams and roles will be reduced and streamlined to put focus on the overall organisation's growth.
Expedia has declined to comment on Marketing's queries. Expedia embarked on a reorganisation plan earlier in 2019, with the goal of bringing its brands and technology together in a more efficient way. In its last financial report published in December 2019 , the company said it aims to simplify operations and increase efficiency. The report revealed that the company is targeting US$300-500 million of run-rate cost savings across its business. In the statement, it also said that it will not be able to provide a specific guidance range given the uncertain COVID-19 situation.
The financial report also covered the resignation of Expedia CEO Mark Okerstrom and CFO Alan Pickerill leaving the company. Chairman Barry Diller said the senior management and the board disagreed on strategy. "This reorganisation, while sound in concept, resulted in a material loss of focus on our current operations, leading to disappointing third quarter results and a lackluster near-term outlook. The board disagreed with that outlook, as well as the departing leadership's vision for growth, strongly believing the company can accelerate growth in 2020," Diller added.
In the earnings call in December, Diller said that Expedia has become "sclerotic and bloated" and it needed to stop "doing dumb things" and, instead, do "good things". According to Diller, Expedia has lost clarity and discipline for several years due to its corporate culture. Meanwhile, Expedia's overall revenue increased 8% driven primarily by growth in Expedia Partner Solutions, and brands Vrbo, Hotels.com and Brand Expedia. Its domestic revenue increased 11% and international revenue increased 4%. The financials reported that advertising and media revenue has also increased 1% in 2019 due to growth at Expedia Group Media Solutions, largely offset by declines at travel website trivago.