Automattic begins layoffs after board shakeup and executive departures

Automattic, the parent company operating WordPress.com, WooCommerce, Tumblr, and numerous other web platforms, has begun cutting staff, with insiders indicating the reductions will likely spread through the remainder of the year. Over at least the past week, departures have impacted the communications team, social media operations, the WordPress.com business unit itself, and its VIP enterprise services division.

The timing of the layoffs coincides with organizational upheaval. In September, Automattic’s board attempted to remove CEO Matt Mullenweg. The effort failed, but it triggered the departure of virtually the entire board, as well as exits from senior executive ranks, including the Chief Financial Officer and Chief Legal Officer.

Scale and Scope of Reductions

Automattic’s public company information lists its workforce at 1,397 employees. Staff familiar with management’s plans indicate that rather than executing cuts all at once, the company intends to phase the layoffs across the fourth quarter. According to these sources, this strategy aims to preserve fourth-quarter revenue figures ahead of a debt renegotiation scheduled for June 2027.

Which Departments Are Affected

The reductions have touched multiple units within Automattic’s portfolio. Megan Fox, Director of Communications, announced her departure on LinkedIn last week, describing it as an “unexpected end” to her role and noting that her position had been “eliminated.” The social media team has experienced cutbacks, as have marketing and product divisions within WordPress.com. The VIP enterprise services division has also been affected.

The Executive Departures

Jeremy Klaperman, who took the interim Chief Financial Officer position following the board restructuring, has left the company, only weeks after the board shakeup. When TechCrunch reported his departure, Mullenweg posted on social media suggesting that Klaperman may have been offended by Automattic’s pursuit of external candidates for the permanent CFO role. However, internal sources indicated that Mullenweg had actually appealed to Klaperman to reconsider leaving.

Board Crisis and Executive Turnover

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The current layoffs cannot be separated from the organizational turmoil that preceded them. In September, Automattic’s board undertook a failed attempt to remove CEO Mullenweg. Though the coup did not succeed in its immediate objective, it triggered a complete overhaul of the board, with departing board members replaced entirely. The period also saw exits from other senior positions: the Chief Financial Officer and Chief Legal Officer both departed around the time of the board upheaval.

September’s Failed Coup

The board’s attempt to remove Mullenweg, though unsuccessful, fundamentally destabilized the organization’s leadership structure. The resulting board turnover means that virtually every board member was replaced. This senior-level churning has created ongoing instability, with the company still absorbing the impact of rapid executive changes.

CEO’s Management of Departures Raises Concerns

The manner in which Mullenweg has handled staff departures has drawn internal concern. In one notable instance, Mullenweg shared personal health information regarding a recently departed executive in Automattic’s internal Slack channel. The post referenced a health issue affecting the executive’s spouse and claimed the company had not provided necessary COBRA insurance coverage. Mullenweg further stated that the executive was threatening legal action regarding the insurance matter.

Personal Information Shared in Internal Slack

In the same Slack communication, Mullenweg disclosed that his own fiancée had been affected by the same health condition. Multiple employees told TechCrunch that they found it surprising for the CEO to disclose such private medical information in a company-wide internal forum.

Financial Timeline and Debt Renegotiation

The structure of the current reduction, spreading layoffs across the fourth quarter rather than implementing them immediately, suggests financial motivation. By lowering expenses gradually through year-end while maintaining revenue figures, Automattic appears to be positioning its finances ahead of the June 2027 debt renegotiation. This approach implies that the current wave of departures may be only the initial phase of a broader restructuring.

When initially asked about the layoffs, Mullenweg characterized them as falling within the company’s normal range of personnel adjustments. By midweek, as additional departures were reported, Mullenweg responded that he was “mostly focused on PHP,” citing a security issue affecting PHP sites across the internet as his current priority.

What Comes Next

Employees have indicated that additional layoffs are anticipated in coming months. With management’s acknowledged plan to spread reductions across the fourth quarter and potentially beyond, and with the June debt renegotiation looming, further departures appear likely. The current instability spanning from board upheaval through executive exits to ongoing staff reductions suggests Automattic will continue navigating organizational changes through the coming months.

Source: TechCrunch