Snap’s Latest Cut: Its San Francisco Office

Snap Inc., which is cutting costs and relying more on remote work, is closing its office in San Francisco, dealing a fresh blow to a city trying to revive its business district.

The San Francisco office is one of several in the Bay Area, including one that opened recently in Palo Alto, the company said. Snap will continue to let San Francisco employees use a coworking space in the city.

“Our San Francisco location was lightly used by team members following our move to flexible work,” said the company, which makes the Snapchat social-media app. Snap has switched more aggressively to a work-anywhere philosophy, unlike some tech peers such as Apple Inc. that are still requiring office employees to show up a few days a week.

Snap also is making broader cutbacks as it copes with a sales slump. The Santa Monica, California-based company just reported its slowest quarterly revenue growth ever, saying that a decline in advertising spending continues to drag on results. Snap has been refocusing its business and announced plans in August to cut 20% of its workforce.

Though the San Francisco location is small, the closure marks a setback for the city’s efforts to lure back workers. Return-to-office rates have been stuck around 40% of pre-pandemic levels, according to security company Kastle Systems. That puts it among the lowest of the 10 major US metro areas.

Social-media rival Twitter, based in San Francisco, also may soon be scaling back workers. Elon Musk, who is buying the company for $44 billion, has told potential investors that he’s planning to cut as much as 75% of the staff.

Snap plans to continue to monitor office usage in other cities where it operates. Insider previously reported on the plan to close the San Francisco location.