firedSocial web discovery engine StumbleUpon confirmed tonight that it has reduced headcount by 30 percent, cutting 35 of 110 employees.

When I contacted Mike Mayzel, StumbleUpon’s director of communications, he said the layoffs were not the initial stages of a death spiral:

StumbleUpon is restructuring to enable the company to become more streamlined, focused and to better execute against its goals in 2013. As a result of these changes, the company will be profitable and will operate more quickly and efficiently and experiment more aggressively. We continue to grow and remain focused on providing the best discovery experience on the Web.

StumbleUpon reached 20 million users in late 2011 but has suffered somewhat as Reddit has become the Internet’s go-to hub for interesting content. Its audience skews a little older than Reddit’s, and its last few redesigns, including one just four months ago, have met with mixed reviews. Still, it has continued innovating with stunning mobile apps and a new Windows 8 app.

Unfortunately, despite all the work and innovation, StumbleUpon’s traffic graph looks like the Marlboro Man’s cigarette in the anti-smoking ads:

StumbleUpon traffic, according to Compete

Above: StumbleUpon traffic, according to Compete

Image Credit:

That’s 9.7 million unique monthly visitors at the beginning of 2012, dropping off to 5.8 million at the end of the year.

The restructuring may be about refocusing, getting quicker, and experimenting more aggressively, and being profitable is wonderful, but unless StumbleUpon can reverse this traffic decline, this layoff won’t be the company’s last.

photo credit: muffytyrone via photopin cc