PayPal Holdings Inc. said restructuring costs tied to trimming its global workforce totaled US$71 million in the second quarter. 

The job cuts will ultimately save the payments giant about US$260 million this year, including approximately US$100 million in stock-based compensation, according to a regulatory filing Wednesday. PayPal is looking to the staff cutbacks as a way to reduce expenses and satisfy investors, who have punished the firm’s shares in recent quarters. 

Earlier this year, “management initiated a strategic reduction of the existing global workforce intended to streamline and optimize our global operations to enhance operating efficiency,” PayPal said in the filing. “As part of this effort, we are focusing on reducing redundant operations and simplifying our organizational structure.”

The PayPal application in the Apple App Store on a smartphone arranged in Saint Thomas, U.S. Virgin Islands, on Saturday, Jan. 29, 2022. PayPal Holdings Inc. is scheduled to release earnings figures on February 1.
In all, the San Jose, California-based company recorded US$90 million in total restructuring and other charges for the quarter. The remaining amount came from PayPal’s efforts to shutter offices as it continues “to review our facility needs due to our new and evolving work models.”

The firm expects the job cuts and other activities to cost it an additional US$15 million in restructuring charges this year.

PayPal soared 14 per cent in late trading Tuesday after the company said its recent efforts to reduce expenses will result in US$900 million in cost savings this year alone before ballooning to US$1.3 billion next year. The company also announced it now counts Elliott Investment Management as one of its largest shareholders after the activist investor took a US$2 billion stake in the payments firm.