Things are not looking good for Visa employees. As the company posts record results, sources indicate to Wall Street Journal that it is preparing a restructuring of its workforce, with no fewer than 1,400 layoffs planned. The restructuring will primarily affect the technology department, with around 1,000 job cuts. The rest of the cuts will mainly concern the merchant sales teams and global digital partnerships, a strategic department which notably manages relationships with technology giants and fintechs, including Amazon.
This announcement comes in a paradoxical context since the company, which has more than 30,000 employees worldwide, displays solid financial health. She has just announced an increase of 12% in its turnover and an increase of 14% in its net profit over the quarter. Payment volume also grew 8% year-on-year.
Regulatory challenges
This restructuring comes as Visa faces increasing regulatory pressures. Last month, the U.S. Department of Justice filed a lawsuit against the company for anticompetitive practices, accusing it of illegally monopolizing the debit card payments market. Additionally, the company is struggling to resolve a long-standing dispute with merchants over credit card transaction fees.
Faced with these accusations, Visa maintains its stance in favor of competition and innovation. A spokesperson for the company also stressed that the company “continues to evolve to better serve its customers and support its growth”adding that Visa plans to increase its workforce, despite these job cuts.
For employees affected by this restructuring, particularly those on global digital partnerships teams, Visa plans to maintain their employment until the end of the year and encourages affected individuals to apply for vacant positions within the company.
The announcement of these job cuts had a mixed impact on Visa’s share price. After the publication of the article Wall Street Journal on these dismissals, the stock rose about 1.5% in after-market trading. This is little compared to the excellent results announced.
- Visa plans to cut around 1,400 positions by the end of 2024, mainly in the technology and business sectors
- This restructuring comes despite excellent financial results (+12% revenue, +14% net profit)
- The company faces significant regulatory challenges, including a Justice Department lawsuit over anticompetitive practices
