Snap got rid of its Web3 unit as a result of a lot of layoffs.

The company's growth rates hit their lowest point in the last five years during the second quarter. As a result, the company has decided to let go of 20% of its employees.

Snap (SNAP) has decided to get rid of its Web3 team in order to cut costs because the company's growth has slowed down a lot.

Jake Sheinman, who helped start Snap's Web3 team, said he was leaving the company in a tweet on Thursday. In the tweet, he also talked about what plans the social media giant has.

"As a result of the company restructure, decisions were made to shut down our [W]eb3 team," the tweet said.

The comment request that CoinDesk sent to Sheinman was not answered right away.

After the company reported its earnings for the second quarter in July, Snap CEO Evan Spiegel said that the company's executives were worried about the company's poor performance.

In a note to investors, the company said, "Our financial results for Q2 do not match the size of our goals." "We're not happy with the results we're getting so far."

Snap's second quarter revenue of $1.11 billion was up 13% from the same quarter last year, but it was well below the company's previous guidance of 20% to 25% and below analyst estimates.

Even so, Snap's sales were 13% higher than the same quarter last year.

A few weeks after the information was first made public, Spiegel said on Wednesday that 20% of Snap's employees will be let go.

Spiegel wrote, "The size of this cut should make it much less likely that we'll have to do this again, while still letting us invest in our long-term future and speed up our revenue growth."

People think that the layoffs will hurt Snap's augmented reality (AR) Spectacles team the most, putting a quick end to the company's love affair with AR.

Snapchat started selling Spectacles, which are AR glasses, in 2016. This was three years after the company first came out with its own AR filters called Lenses.

In 2021, the company paid more than $500 million to buy WaveOptics, the company that makes the augmented reality displays used in Snap's Spectacles. This was the biggest purchase the company had ever made. This transaction happened the year before.

Even as recently as July, the company had planned to do research on a feature that would let users import NFTs into Snapchat and use them as augmented reality filters. However, it is currently unclear whether or not this project will go forward in light of the upcoming layoffs.

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