After massive layoffs, Snap disbanded its Web3 division.

The company's growth rates hit a five-year low in the second quarter, and as a result, the management has decided to lay off 15 percent of the workforce.

Considering the company's significantly slowed growth, Snap (SNAP) has decided to disband its Web3 team in an effort to cut costs.

Jake Sheinman, co-founder of Snap and its Web3 team, announced his departure from the company in a tweet on Thursday. He also spilled the beans on the social media giant's future plans in the tweet.

In light of the company's restructuring, it has been determined to "sunset our [W]eb3 team," as stated in the tweet.

CoinDesk's request for comment sent to Sheinman went unanswered for some time.

CEO Evan Spiegel said the executives were worried about the company's underperformance after the company reported its second quarter earnings in July.

In a note to shareholders, the company admitted, "Our financial results for Q2 do not reflect the scale of our ambition." We are not happy with the outcomes we have produced so far.

Revenue of $1.11 billion for Snap's second quarter was up 13% year over year but fell short of the company's previous guidance of 20% to 25% and analyst estimates.

In spite of this, Snap's revenue increased by 13% compared to the same quarter in 2017.

Spiegel announced on Wednesday that 20% of Snap's workforce will be eliminated, several weeks after the data was first disclosed.

Spiegel explained that the move was made to balance the company's desire to invest in its long-term future and reaccelerate its revenue growth with the need to reduce costs.

Snap's augmented reality (AR) Spectacles team is expected to be hit particularly hard by the layoffs, bringing an end to the company's brief love affair with AR.

Three years after releasing Lenses, Snapchat's own augmented reality (AR) filters, in 2016, the company released a pair of AR glasses called Spectacles.

In 2021, Snap spent more than $500 million to acquire WaveOptics, the provider of the augmented reality displays used in Snap's Spectacles, marking the company's largest acquisition to date. Last year was when this deal was made.

As recently as July, the company had planned to investigate a feature that would allow users to import NFTs into Snapchat and use them as augmented reality filters; however, it is currently unknown whether or not this initiative will proceed in light of the impending layoffs.

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