According to a company memo sent to staff on Thursday by chief executive Bruce Dixon, Vice Media intends to lay off several hundred of its more than 900 employees over the course of the following week.
The company will make the most recent cuts in a string of severe reductions experienced recently, reducing the world-spanning digital colossus to its former self. Vice has become the poster child for the struggling digital media sector over the past 50 years as a result of its nearly yearly layoffs, mounting losses, and bankruptcy filing.
Some observers hoped that Vice's new owners, a group led by the private equity firm Fortress Investment Group, would reinvest when the company declared bankruptcy last year to spur growth.
Instead, Fortress has made the decision to make broad cuts in an effort to stop the never-ending red ink flow. In the coming week, the business intends to let its staff know about its new business strategy.
The New York Times reported that Mr. Dixon also stated in the memo that Vice.com would no longer be published by the company.
He stated that in order to remain competitive over the long term, we must adapt and best align our strategies as we navigate the constantly changing business landscape. Vice, the company's women-focused publishing division, is reportedly in advanced talks to sell Refinery29, he added.
The media industry as a whole is facing intense headwinds as the layoffs occur.
Almost all major news publishers have reduced their operations over the past year, including The Wall Street Journal, The Washington Post, Vox Media, and The Los Angeles Times. Users are now using non-traditional media platforms like TikTok and Instagram, which has caused a sharp decline in web traffic to news organizations.
Before this planned string of cuts, Vice was in poor shape. Over the past two years, the business has been periodically put up for sale as long-promised profits have fallen through. Executives bet on large, intricate content deals for clients like the Greek media company Antenna and the cigarette manufacturer Philip Morris International as the business environment for digital media grew more precarious.
Vice's financial situation deteriorated when the contract with Antenna was terminated last year, and the business filed for bankruptcy. However, despite a court-supervised sale process, the business was unable to become profitable, and debts kept piling up.
Vice, a Montreal-based punk magazine that was founded more than 20 years ago, attracted $5.7 billion in investment from media behemoths like A&E Networks, Disney, and the private equity firm TPG. However, as the market for digital media crashed, the company experienced a sharp turn of events and struggled to live up to its eye-popping valuation, leaving its financial backers and employees with no return on their investment.
