Affirm announced it’s cutting 19% of its workforce Wednesday. The news came as it reported second quarter earnings that fell below analyst estimates on both the top and bottom lines.

Shares were down more than 17% after hours.

In his letter to shareholders Wednesday, Founder and CEO Max Levchin called the decision “the single most difficult one” of all the cuts the company chose to make, and said the layoffs would be effective that day.

Affirm said in June 2022 it had 2,552 employees, which means the layoffs impact about 485 people.

In a message Levchin sent to employees earlier on Wednesday that he later shared publicly, he said that during the early part of the pandemic, the company “consciously hired ahead of the revenue required to support the size of the team,” with revenue growth justifying the strategy.

“Everything changed in mid-2022,” Levchin said, pointing to Federal Reserve policy that he said has “dampened consumer spending and increased Affirm’s cost of borrowing dramatically.”

“The root cause of where we are today is that I acted too slowly as these macroeconomic changes unfolded,” Levchin wrote.

The company reported a loss per share of $1.10 for its fiscal second quarter of 2023, while analysts were anticipating a loss of 98 cents per share, according to Refinitiv. It also missed on revenue expectations, reporting $400 million in revenue for the quarter compared to analyst estimates of $416 million, according to Refinitiv.

Levchin told shareholders Affirm expects to keep headcount “essentially flat for the foreseeable future.”

“In FQ2’23, we redirected the substantial majority of our R&D efforts towards margin-improving projects, repeat consumer engagement, and Debit+ and plan to continue executing this focused roadmap for several quarters,” Levchin said.

Levchin told employees that laid off workers in the U.S. would be offered a minimum of 15 weeks base pay as severance plus an additional week per year of tenure. Laid off U.S. workers would also receive a $5,000 health stipend regardless of enrollment status, covering six months of employee healthcare. Non-U.S. employees would receive severance and healthcare benefits “in line with local practices,” Levchin said.

Workers reliant on an employer-sponsored visa will remain employed by Affirm through April 30, Levchin said, and they could access one-on-one counseling with an Affirm immigration lawyer.

Levchin also said laid off workers could keep their Affirm-issued devices to aid them in their job search, and they could access three months of career advising and an alumni directory.