PayPal has joined IBM, SAP, Spotify, Google parent Alphabet, Intel, Microsoft, Coinbase, Cisco, Amazon, Salesforce, HP, Roku, Beyond Meat, Meta and Twitter in announcing major layoffs in recent months.
More than 75,000 global technology-sector employees have been laid off in the first few weeks of 2023 alone, according to data compiled by the website Layoffs.fyi.
Here's a look at the list of big names across a number of sectors that have been cutting back their workforces.
PayPal
PayPal Holdings Inc. (PYPL) is cutting its global workforce by approximately 2,000 full-time employees, or 7% of the company's total workforce. Chief Executive Dan Schulman announced the layoffs in an email to employees. "These reductions will occur over the coming weeks, with some organizations impacted more than others," he wrote.
"While we have made substantial progress in right-sizing our cost structure, and focused our resources on our core strategic priorities, we have more work to do," Schulman said in the email. "We must continue to change as our world, our customers, and our competitive landscape evolve."
PayPal will continue to hire "strategically" this year, spokeswoman Amanda Miller told MarketWatch.
In August, PayPal announced a cost-cutting initiative, saying it was targeting at least $1.3 billion in cost savings during 2023.
IBM
International Business Machines Corp. $(IBM)$ is cutting 1% to 1.5% of its workforce. The cuts amount to about 3,900 employees, IBM Chief Financial Officer James Kavanaugh said in an interview with Bloomberg, which was the first to report the job cuts.
The layoffs were not mentioned on the conference call to discuss IBM's fourth-quarter results. A spokesman said the cuts were mostly related to a spinoff and the sale of IBM's Watson Health unit, resulting in a $300 million charge in the first quarter.
SAP
SAP (SAP.XE) is cutting almost 3,000 jobs amid a restructuring effort. When it announced its fourth-quarter results, the business-software maker said it is undertaking a "targeted" restructuring in 2023 focused on strategic growth areas and "accelerated cloud transformation."
The restructuring program will affect some 2,800 employees. At the end of 2022, the Walldorf, Germany-based company had 111,961 employees globally.
Lam Research
Silicon Foundry-equipment supplier Lam Research Corp. $(LRCX)$ said it will cut its global workforce by 7%, or 1,300 employees, by the end of March. The cuts do not include a separate reduction to Lam Research's "temporary workforce" that saw 700 people being let go at the end of December.
The cuts came as Lam Research reported its results for the quarter ending Dec. 22, 2022. "Given the decline in wafer fabrication equipment spending expected in calendar year 2023, we are taking proactive steps to lower our cost structure and drive efficiencies across our global footprint, while preserving critical R&D," said CEO Tim Archer in a statement. "With these actions, Lam is focused on accelerating our strategic priorities to capitalize on the semiconductor industry's long-term growth prospects."
Spotify
In a filing with the Securities and Exchange Commission, Spotify Technology $(SPOT)$ said it is reducing its workforce by about 6%, which translates to about 588 jobs.
Bloomberg News originally reported that the streaming music service was planning job cuts. At the end of the third quarter, Spotify had 9,808 full-time employees globally.
The Stockholm-based company estimates that it will incur approximately EUR35 million to EUR45 million ($38.1 million to $48.9 million) in severance-related charges.
The job cuts come after Spotify slowed its pace of hiring last year. Last June, Spotify CEO Daniel Ek told employees that the company would reduce its hiring by 25%, according to Bloomberg and CNBC reports. Spotify laid off at least 38 employees at its Gimlet and Parcast podcast units in October.
In recent years, Spotify has spent massive amounts on podcasts, which has weighed on the company's margins. The podcast spending has yet to deliver profits, although last year Ek predicted a meaningful increase in profitability in the next couple of years.
In its SEC filing, Spotify said that, as part of a broader reorganization, the company's chief content and advertising business officer, Dawn Ostroff, will depart.
Google parent Alphabet Inc. $(GOOGL)$(GOOGL) has announced plans to cut approximately 12,000 jobs globally. In a blog post, Alphabet and Google CEO Sundar Pichai described the layoffs as "a difficult decision to set us up for the future."
"The fact that these changes will impact the lives of Googlers weighs heavily on me, and I take full responsibility for the decisions that led us here," he added.
Like a number of other tech giants that have made layoffs recently, such as Microsoft Corp. $(MSFT)$ and Meta Platforms Inc. $(META.UK)$, Alphabet expanded to meet demand during the pandemic era but is now confronted with a different economic situation, Pichai said. "Over the past two years we've seen periods of dramatic growth. To match and fuel that growth, we hired for a different economic reality than the one we face today."
At the end of September 2022, Alphabet had almost 187,000 employees, up from almost 164,000 employees at the end of March.
"As an almost 25-year-old company, we're bound to go through difficult economic cycles," Pichai said. "These are important moments to sharpen our focus, re-engineer our cost base, and direct our talent and capital to our highest priorities."
Echoing recent comments from Microsoft, Pichai also highlighted the importance of artificial intelligence. "Being constrained in some areas allows us to bet big on others," he said. "Pivoting the company to be AI-first years ago led to groundbreaking advances across our businesses and the whole industry."
The CEO said that the company is getting ready to share "some entirely new experiences" for users, developers and businesses. "We have a substantial opportunity in front of us with AI across our products and are prepared to approach it boldly and responsibly," he added.
Last year, a report in The Information said that Google was considering cutting 10,000 jobs. The company may employ a ranking system that would eliminate the lowest-ranked "poor-performing" employees, the report said.
"Earlier this year, we launched Googler Reviews and Development (GRAD) to help employee development, coaching, learning and career progression throughout the year," a Google spokesperson told MarketWatch in a statement at the time. "The new system helps establish clear expectations and provide employees with regular feedback."
Intel
Intel Corp. $(INTC)$ is slashing hundreds of jobs in Silicon Valley. The cuts add to layoffs that began late last year as part of previously announced job cutting.
According to filings with California's Employment Development Department, the chipmaker is is cutting 201 jobs at its offices in Santa Clara, Calif., which is home to Intel's headquarters, effective Jan. 31. In late December Intel reported 90 job cuts, during which the company confirmed that it also has put some manufacturing employees on unpaid leave.
The tech giant is also adding to the 111 job cuts previously announced in Folsom, Calif., at a campus dedicated to research and development. There are now 176 layoffs effective Jan. 31, and an additional 167 job cuts effective March 15.
Intel also expects more layoffs will be detailed in future filings.
In October, Intel announced plans for job cuts as it reported its third-quarter results. The chip maker said it was focused on driving $3 billion in cost reductions in 2023. "Inclusive in our efforts will be steps to optimize our headcount," Chief Executive Pat Gelsinger said during a conference call with analysts to discuss the third-quarter results.
The chipmaker had 121,000-plus employees worldwide at the end of 2021.
Microsoft
Microsoft Corp. $(MSFT.UK)$ joined other tech giants in the layoffs spotlight when the software maker confirmed plans to cut about 10,000 positions.
"Today, we are making changes that will result in the reduction of our overall workforce by 10,000 jobs through the end of [the third quarter of fiscal year 2023]," Microsoft CEO Satya Nadella wrote in a blog post on Jan. 18. "This represents less than 5 percent of our total employee base, with some notifications happening today."
Microsoft, he said, is aligning its cost structure with its revenue and with where the company sees customer demand. Nadella wrote that while customers had accelerated their digital spending during the pandemic, they are now looking to "optimize" their digital spending to do more with less. "We're also seeing organizations in every industry and geography exercise caution as some parts of the world are in a recession and other parts are anticipating one," he added.
The tech giant is taking a $1.2 billion charge in the second quarter related to severance costs, changes to its hardware portfolio and costs of lease consolidation as it creates higher density across its workspaces.
The layoffs did not come completely out of the blue. Earlier reports from Sky News and Bloomberg indicated that Microsoft was preparing to make cuts.
In the blog post, Nadella said that while Microsoft is eliminating roles in some areas, the company will continue to hire in key strategic areas. The CEO did not specify which areas will see hiring but did describe advances in artificial intelligence as "the next major wave of computing."
Coinbase
Coinbase Global Inc. $(COIN)$announced 950 job cuts in an attempt to cut costs.
"In 2022, the crypto market trended downwards along with the broader macroeconomy," said Coinbase CEO Brian Armstrong, in a message to employees on Jan. 10. "We also saw the fallout from unscrupulous actors in the industry, and there could still be further contagion."
The crypto exchange said it will book charges of about $149 million to $163 million for the cuts, divided between about $58 million to $68 million in cash charge relating to severance and $91 million to $95 million in stock-based compensation charges relating to the vesting of outstanding equity awards.
The job cuts follow the company's announcement in June that it would lay off 18% of its employees.
Cisco
Cisco Systems Inc. $(CSCO)$ has begun previously announced layoffs, cutting nearly 700 jobs in Silicon Valley in December, according to filings with the state of California in January.
The layoffs span a number of departments at the networking giant and extend across various positions, including software and hardware engineering, program management, product design and marketing. According to the state filings, the number of employees at the company's San Jose, Calif., headquarters who are affected totals 371, while 222 jobs are being cut in nearby Milpitas and 80 are being cut in Cisco's San Francisco office. The notices said employees were notified in early December and were given a choice of an effective termination date of either Feb. 1 or March 13.
In November, Cisco announced it was planning a "limited business restructuring" that will adjust the networking giant's real-estate portfolio and affect about 5% of its 80,000-strong global workforce, or some 4,000 people.
"This is about rebalancing across the board," said Cisco Chief Financial Officer Scott Herren at the time, adding that as many jobs will be added as reduced.
"Our goal is to minimize the number of people who end up having to leave," Herren told MarketWatch. "We will match as many with new roles at the company as we can. This is not about reducing our workforce. In fact, we'll have roughly the same number of employees at the end of this fiscal year as we had when we started."
Amazon
Amazon.com Inc. $(AMZN)$ kicked off the New Year by confirming more than 18,000 job cuts, more than originally expected. "Between the reductions we made in November and the ones we're sharing today, we plan to eliminate just over 18,000 roles," Amazon CEO Andy Jassy wrote in a letter to employees on Jan. 4. "Several teams are impacted; however, the majority of role eliminations are in our Amazon Stores and PXT [People Experience and Technology Solutions] organizations."
"Amazon has weathered uncertain and difficult economies in the past, and we will continue to do so," Jassy added. "These changes will help us pursue our long-term opportunities with a stronger cost structure; however, I'm also optimistic that we'll be inventive, resourceful, and scrappy in this time when we're not hiring expansively and [are] eliminating some roles."
Amazon subsequently filed notices of more than 3,000 job cuts in New York, California and the company's home state of Washington, as required by law.
Last year the e-commerce giant confirmed plans to lay off workers in its devices and services business. At that time, The Wall Street Journal reported that Amazon could eventually cut about 10,000 jobs.
Analysts at Morgan Stanley are looking for Amazon and other tech companies to continue reining in costs.
Salesforce
Salesforce Inc. $(CRM)$ will lay off 10% of its workforce as part of a restructuring plan.
The San Francisco-based company announced the layoffs in a filing with the Securities and Exchange Commission on Jan. 4. In addition to the job cuts, Salesforce plans to exit some real estate and reduce office space.
The restructuring plan is intended to reduce operating costs, improve operating margins and continue advancing Salesforce's commitment to "profitable growth," the company said in the filing.
Salesforce estimates that it will incur approximately $1.4 billion to $2.1 billion in charges in connection with the restructuring plan, of which approximately $800 million to $1 billion is expected to be incurred in the fourth quarter of fiscal 2023.
Most of the layoffs will be made in the coming weeks, Salesforce CEO Marc Benioff said in a letter to employees that was also filed with the SEC.
The Salesforce chief said that the company grew too quickly for the current environment. "I've been thinking a lot about how we came to this moment," he wrote. "As our revenue accelerated through the pandemic, we hired too many people leading into this economic downturn we're now facing, and I take responsibility for that."
Last year, Salesforce laid off hundreds of employees from its sales team, according to news reports, as the tech sector as a whole wrestled with a challenging economic environment. "Our sales performance process drives accountability," said a Salesforce spokesperson in a statement emailed to MarketWatch in November. "Unfortunately, that can lead to some leaving the business, and we support them through their transition."
As of February 2022, the company, which provides customer-relationship-management software, had over 78,000 employees globally.
HP
In November, HP Inc. $(HPQ)$ executives announced plans to cut up to 10% of the company's workforce amid what CEO Enrique Lores described as "a volatile macro environment and softening demand in the second half, with a slowdown on the commercial side."
"Companies are delaying their refresh [sales] cycle," Lores told MarketWatch in an interview ahead of the public release of the company's fourth-quarter results.
HP is launching a three-year workforce-reduction plan meant to shed 4,000 to 6,000 jobs, according to Lores, with more than half of the roughly $1 billion in restructuring costs expected to be realized in the new fiscal year.
Roku
Roku Inc. (ROKU)announced in November that it would cut about 5% of its workforce amid a challenging advertising landscape.
"Due to the current economic conditions in our industry, we have made the difficult decision to reduce Roku's headcount expenses by a projected 5%, to slow down our [operating-expense] growth rate," the company said in a brief statement, noting that about 200 positions in the U.S. would be affected. "Taking these actions now will allow us to focus our investments on key strategic priorities to drive future growth and enhance our leadership position," the statement said.
In a filing with the Securities and Exchange Commission, Roku said it anticipated charges of about $28 million to $31 million related to the job cuts, mainly stemming from severance payments, notice pay, employee benefits and other costs. The company expected to take the bulk of those charges in the fourth quarter of 2022. Implementation of the workforce reductions will be mostly complete by the end of the first quarter of 2023, it said.
Kaltura
Video software company Kaltura Inc. $(KLTR)$ said Jan. 4 it's planning to reduce its workforce by about 11%.
In a filing with the Securities and Exchange Commission, Kaltura said its reorganization plan aims to increase efficiency and productivity in response to the current macroeconomic climate. "The plan's main objectives are to position the company for lower demand, spend, and available budgets across the company's market segments, align the company's business strategy in light of these market conditions and support the company's growth initiatives and return path to profitability," it said.
On an annualized basis, the total cost reduction from Kaltura's downsizing is expected to be approximately $16 million.
The New York-based company will initially book pretax charges of approximately $1 million, primarily for severance and related costs, all of which are expected to be expensed in the first quarter of 2023. The reorganization plan is expected to be "substantially completed" in the first half of 2023, according to the SEC filing.
RingCentral
RingCentral Inc. $(RNG)$ joined the list of tech companies making layoffs with the November announcement of a plan to cut 10% of its workforce as part of a broader push to cut costs amid a deteriorating economic environment. The cloud-based communications company's stock jumped on news of the layoffs and of RingCentral's third-quarter earnings, which beat analysts' expectations.
In October, RingCentral was added to the list of "zombie" stocks compiled by equity research firm New Constructs.
New Constructs, which uses machine learning and natural language processing to parse corporate filings and model economic earnings, described RingCentral as a "cash incinerator" at risk of declining to $0 per share.
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