8x8 to Reduce 7% of Workforce, Significantly Impacting Channel Staff

8×8 layoffs will impact 7% of the company’s global workforce in coming months. MarketWatch is reporting that it’s part of restructuring to refocus the cloud communication provider’s target market and to cut costs. Approximately 2,200 employees work at the organization, and the cuts will affect about 155 employees.

There’s speculation these layoffs could be part of an effort to ready 8×8 for acquisition.

Moreover, the cuts are impacting channel managers and directors, as well as direct SMB salespeople, a source close to the company reports. Vice presidents are also affected by the reduction, the source said. Another industry insider told Channel Futures that 8×8 laid off nearly its entire channel staff. We couldn’t immediately verify this information with 8×8 as officials did not respond to our questions. However, the company directed Channel Futures to its most recent 8-K filing.

8×8’s Samuel Wilson

The filing includes a copy of an email Samuel C. Wilson, 8×8’s interim CEO, sent to employees regarding the layoffs.

“Our success depends heavily on the ability to make difficult choices about where to deploy resources in order to create the greatest value,” Wilson wrote. “I wish it were never so, but sometimes that includes letting go of people, despite their excellent work, as priorities shift. Regrettably, that is the situation we currently face at 8×8 in order to align with emerging marketplace opportunities.”

Wilson outlined a six-pronged approach to growth for the company, including increasing XCaaS (experience communications as a service) win rates, maintaining an “outstanding” UCaaS customer experience and establishing CPaaS (communications platform as a service) leadership in APAC.

Wilson became interim CEO in November, replacing Dave Sipes, who was at the helm for nearly two years. Sipes’ departure wasn’t the only telling sign of a fractured company. 8×8’s stock has plunged more than 70% over the year.

Fuze Success?

A year ago, 8×8 appeared purpose-driven when it purchased Fuze, the company’s largest acquisition to date.

“We made this business decision for one major reason, to jump-start our innovation engine,” Wilson wrote on LinkedIn just three weeks ago. “This incredibly talented workforce is busy creating new products and features. Our most recent release shows some of what we brought to market in 2022, but 2023 promises to be even bigger. We are just warming up.”

However, 8×8 employees at Fuze were also let go during the first year post-acquisition. There were at least three rounds of layoffs among Fuze employees alone, according to Hope Pickett. The IT program manager took to LinkedIn to describe her husband’s experience working at Fuze. Clete Pickett, who served as a senior network escalation engineer, was laid off by 8×8 in October.

Hope described the reason for her husband’s layoff as the company did not have room for his skills and that it didn’t have or need team leads.

“We are on the lookout for his next role,” she wrote. “Something that will benefit him and the employer. As you can see, he has no want to be someone who hops from job to job, and he wants to make an impact.”

Look for the 8×8 layoffs process to wrap by June 30, the end of 8×8’s fiscal first quarter.