Airbnb, seen until recently as one of Silicon Valley’s most financially secure unicorns, is laying off a quarter of its staff. It’s an ominous sign for the tech economy.

Brian Chesky, the company’s founder and CEO, told staff on Tuesday that the company’s revenue would be halved and that it would terminate about 1,900 of its 7,500 staff members — one of the largest layoffs in total that Silicon Valley has seen since the Covid-19 pandemic struck. Airbnb’s decision serves as a stark reminder of the coronavirus’s toll, which has hamstrung the global economy, forcing almost all startups to consider cuts and particularly wrecking the travel industry.

Calling the virus the “most harrowing crisis of our lifetime,” Chesky said in an email to employees that Airbnb’s revenue in 2020 was projected to be just half of what it collected in 2019, which was reportedly $4.8 billion. As a result, he said Airbnb would streamline its business, scaling back its spending in growth areas such as its pushes into luxury homes and traditional hotels. Cuts are expected to hit those teams harder.

“To those leaving Airbnb, I am truly sorry,” Chesky wrote to employees. “Please know this is not your fault.”

The announcement is a wild reversal of fortune for a company that was expected to be 2020’s leading candidate for an initial public offering. Over the last few weeks, the company secured $2 billion in debt to try to survive the coronavirus pandemic, which has drastically cut back on people’s ability and willingness to travel. Airbnb declined to comment on how this would affect its expected 2020 IPO.

Airbnb has been under pressure from its current and former employees to go public given that some have waited as long as a decade to cash in on their stock options. Chesky said all laid-off employees, even those there for less than a year who wouldn’t ordinarily qualify for vested shares, would receive their equity.

The other marquee company of the sharing economy, Uber, is also reportedly in the process of mulling layoffs that could account for about 20 percent of its staff. Lyft has already laid off about 17 percent of its workforce.

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