LivingSocial announced on Thursday that it will trim its payroll by 400 workers, with most of those cuts coming at its U.S. operations.
The privately held company, which is the second-largest online deal provider behind Groupon (NASDAQ:GRPN), has been reviewing its operations in light of rising competition. Its sales and customer service teams will be hardest hit by the job reductions, the Los Angeles Times noted.
Its customer service unit will also be relocated from Washington, D.C., to a call center in Tucson, Ariz. The company will add 100 workers in Tucson to staff the new facility.
The current round of cuts amounts to about 9% of the company’s 4,500 workers. During its third quarter, LivingSocial said it generated revenue of $124 million, an almost two-fold increase over the same time in 2011. In September, its cash flow was positive for the first time.
Online deal providers are facing tough times. Groupon is reportedly mulling the ouster of its CEO. The daily deals website has seen its share value plunge more than 80% since its 2011 IPO.
LivingSocial has more then 70 million members around the world. The company said it plans to increase spending on marketing and building new mobile channels. Internet retail giant Amazon (NASDAQ:AMZN) holds a 30% stake in LivingSocial.