Updated Telecom-IT Layoff Tracker June 2023: Red Hat, F5, CDW, BT, More
The onslaught of layoffs has only slowed some.
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Sumo Logic cut nearly 80 workers in June after the completion of its acquisition by global investment firm Francisco Partners.
Sumo Logic submitted a Worker Adjustment and Retraining Notification (WARN) notice with the California Employment Development Department. According to The Information, CEO Joe Kim announced the layoffs via email to staff.
The layoffs took place at Sumo Logic’s headquarters in Redwood City, California. Engineering and channel sales employees were impacted by the layoffs.
Displaced workers took to LinkedIn to start their search for new jobs. Among them was Zack Reed, enterprise sales engineering manager.
“While the ending was abrupt, I’m grateful for my time working there and having the chance to lead a genuinely world-class group of SEs,” he said.
In June, HashiCorp announced it is cutting its workforce by 8% or around 190 employees.
HashiCorp announced the job cuts with its financial results for the first quarter of its fiscal 2024. Its revenue totaled $138 million for the quarter, up 37% from $101 million in the same period last year. It reported a $53.3 million net loss for the quarter, compared to a $78.2 million net loss for the year-ago quarter.
“We are responding to the current customer and economic environment with proactive actions to lower our ongoing costs,” said Dave McJannet, HashiCorp’s CEO. “This was a difficult decision that we don’t take lightly, and I am deeply disappointed to lose many valued colleagues. I believe, however, that after these actions we are better positioned for our opportunity.”
Zendesk layoffs are impacting 8% of the company’s workforce, or about 320 of more than 4,000 employees across the globe.
In May, Zendesk CEO Tom Eggemeier sent a note to employees about the layoffs.
Eggemeier said from 2020-2022, Zendesk’s hiring outpaced its business realities.
“When I joined at the end of November, I’d hoped a combination of improving macroeconomic conditions and streamlining costs would help us avoid this moment,” he said. “Unfortunately, macroeconomic conditions have not improved and we find ourselves in an increasingly competitive marketplace.”
At the same time, Zendesk customers are navigating massive shifts in how they do business, including increased pressure to deliver profitable growth and leveraging fast-advancing technology like generative artificial intelligence (AI), Eggemeier said.
In May, BT announced layoffs impacting up to 55,000 of the communications services provider’s workforce over the next five to seven years.
The UK-based company announced the job cuts with its earnings for its fiscal year 2023, which ended March 31. Plans are to reduce the company’s total workforce from 130,000 to somewhere between 75,000 and 90,000 sometime between fiscal years 2028 and 2030.
“By continuing to build and connect like fury, digitize the way we work and simplify our structure, by the end of the 2020s BT Group will rely on a much smaller workforce and a significantly reduced cost base,” said Philip Jansen, BT’s CEO. “[The] new BT Group will be a leaner business with a brighter future.”
The BT layoffs will impact both workers directly employed by BT and non-employees supplied by a third party.
In May, Vodafone announced layoffs impacting 11,000 workers over the next three years as its new CEO said the company’s performance “has not been good enough.”
The job cuts are part of a new road map for the UK wireless carrier, following a strategic review conducted over the last five months. CEO Margherita Della Valle said the end result will be a “leaner and simpler organization, to increase our commercial agility and free up resources.”
The Vodafone layoffs will occur both at its headquarters and local markets. Vodafone employs 104,000 people globally, according to its latest annual report.
In May, Akamai layoffs impacted nearly 300 workers as the company focuses on its highest growth areas and sustaining profitability.
The Akamai layoffs were reported as part of the company’s financial results for the first quarter that ended March 31. According to the Boston Globe, nearly 300 workers are losing their jobs.
Akamai sent us the following statement:
“In order to concentrate our investments and resources in our highest growth areas of security and cloud computing, and to sustain our profitability targets during this challenging macroeconomic environment, Akamai has implemented a reduction of a little less than 3% of its workforce across the globe. We are not providing geographic nor organization-specific details of the workforce reduction, but can confirm that less than 3% of our workforce globally was impacted.”
In April, Dropbox layoffs hit about 16% of the company’s global workforce despite its continuing profitability. The layoffs began immediately.
Dropbox co-founder and CEO Drew Houston announced the cuts in a blog.
“First, while our business is profitable, our growth has been slowing,” Houston said. “Part of this is due to the natural maturation of our existing businesses, but more recently, headwinds from the economic downturn have put pressure on our customers and, in turn, on our business. As a result, some investments that used to deliver positive returns are no longer sustainable.”
Secondly, and more consequentially, the artificial intelligence (AI) era of computing has finally arrived, he said.
“We’ve believed for many years that AI will give us new superpowers and completely transform knowledge work,” Houston said. “And we’ve been building towards this future for a long time, as this year’s product pipeline will demonstrate.”
In April, layoffs hit open-source software developer Red Hat.
Matt Hicks, who has served as the company’s president and CEO for less than a year, sent a company-wide email announcing the Red Hat layoffs.
“There have been several occasions where we’ve had to make tough decisions at Red Hat, but no decision has been harder than the one I must communicate to you today,” Hicks wrote.
With that, he announced that Red Hat is shedding 4% of its workforce. That amounts to about 760 people.
Most of the losses occurred in the general and administrative category throughout the company.
In April, CDW layoffs reportedly displaced hundreds of workers after the company’s CEO said its first quarter was “a period of intensifying economic uncertainty.”
Employees posted about the CDW layoffs on TheLayoff.com. One worker said the CDW layoffs impacted 600-700 workers globally.
“I’m not sure who made the decision on who to lay off, but I can say with certainty that they made several major mistakes,” one worker said. “We lost some excellent folks today whose absence will be felt, that’s for sure. It feels like sometimes the management can’t see the forest for the trees.”
In April, F5 layoffs impacted 9% of the multicloud application services and security company’s workforce, or about 620 workers.
“It was a joke they did this on my day off and I had no clue until I got a email to my personal email saying I was canned and had until 6 p.m. to claim my stuff followed by 30 minutes later cutting me off from the network after the meeting seven hours before what’s stated in the email,” one worker posted on TheLayoff.com. “Put almost 10 years into this job to not even have the respect to let me know I was let go.”
The layoffs were announced with the company’s earnings for the second quarter of fiscal 2023.
Rackspace in March confirmed it’s shedding 275 employees, citing the ongoing macroeconomic downturn.
“During this uncertain time, it is important that we align our cost structure to the demands of the business,” a spokesperson told Channel Futures via email. “This requires some elimination of roles across the company, which was communicated to ‘Rackers’ last week. These reductions represent less than 4% of our global workforce.”
In a March 24 email obtained by The Register, Rackspace CEO Amar Maletira told employees the company had reached a point where it needed to make a decision. Despite cutting costs – including implementing a hiring freeze, delaying bonuses and holding discretionary spending – the MSP continued to struggle.
“As I have said before, we are facing an uncertain macro environment,” Maletira wrote. “From inflationary pressures, high interest rates to the ongoing war in Ukraine and persisting supply chain issues — all signs are pointing to a recession.”
As a result, the San Antonio-based company “eliminated some roles across the company,” Maletira said.
Kyndryl, which spun off from IBM in late 2021, initiated layoffs impacting a “small percentage” of its 90,000 employees globally.
The layoffs began in late March. Kyndryl sent us the following statement:
“We are eliminating some roles globally – a small percentage – to become more efficient and competitive. This is in addition to the ongoing transformation work we have undertaken to streamline and simplify our processes and systems. These actions will enable us to focus our investments in areas that directly benefit our customers and position Kyndryl for profitable growth.”
Accenture in March confirmed layoffs impacting 19,000 workers, or 2.5% of its global workforce to reduce costs.
Accenture announced the layoffs in its latest quarterly report with the SEC. The professional services company said its workforce grew by 39,000 over the past year.
“While we continue to hire, especially to support our strategic growth priorities, during the second quarter of fiscal 2023, we initiated actions to streamline our operations and transform our non-billable corporate functions to reduce costs,” it said.
The layoffs will take place over the next year-and-a-half. More than one-half of the workers are in non-billable corporate functions.
Veeam in March confirmed layoffs impacting 200 workers as part of a shift in investing to increase efficiency.
Veeam sent us the following statement:
“We have reduced our global workforce by 200 people. During this transition, our priority is helping our people, both those affected by this decision and those who remain with Veeam, with the best care and support possible. We are a strong, profitable, fast-growing company. However from time to time, we must make decisions about where we should invest and how we can drive efficiency in the way we go to market. These decisions are wholly based on our priorities and do not reflect the work of those impacted. Veeam continues to hire for roles in R&D.”
Microsoft job cuts continued in March with the latest round impacting 559 workers in and around Seattle.
That’s according to a Worker Adjustment and Retraining Notification (WARN) notice filed with the Washington State Employment Security Department.
The latest layoffs bring the total of Seattle-area cuts to 2,743, or more than one-quarter of the 10,000 cuts announced earlier this year, according to the Seattle Times. The cuts reportedly targeted Microsoft’s security operations.
Microsoft sent us the following statement:
“These workforce reductions are part of the effort to align our cost structure with our revenue that was announced in January via the Official Microsoft Blog, which is our official statement.”
Amazon in March confirmed more layoffs impacting 9,000 workers, including many in Amazon Web Services (AWS). The internet giant in January initiated layoffs impacting 18,000 employees.
In addition, more layoffs are likely as Amazon continues its workforce analysis.
Amazon CEO Andy Jassy detailed the latest layoffs in a message to Amazon employees. They are impacting AWS, the People eXperience and Technology (PXT) group, advertising, and its Twitch live streaming service. The layoffs are ongoing.
Australian software company Atlassian announced a round of layoffs affecting 5% of its workforce, or about 500 employees, according to a blog by the company’s CEOs.
The teams impacted include talent acquisition, program management, and research and insights, among others.
“We want to be clear these decisions are not a reflection of our teammates’ work. Every single person has made contributions that have changed our company for the better and will leave a lasting impact on their peers and teams,” CEOs Michael Cannon-Brookes and Scott Farquhar said. “This is about rebalancing the roles we need across Atlassian first and foremost.”
Cloud security company Zscaler in March confirmed layoffs impacting 3% of its global workforce. That’s approximately 150 employees.
Zscaler announced the layoffs in an SEC filing. The cuts are part of Zscaler’s “planned efforts to streamline operations and to align people, roles and projects to the company’s strategic priorities.”
The company expects to complete the layoffs by the end of July. The company’s workforce is nearly 5,000 employees.
In March, Wipro confirmed layoffs impacting 120 workers in Tampa, Florida, citing a lack of work.
The Wipro layoffs are detailed in a Worker Adjustment and Retraining Notification (WARN) notice filed with the Florida Department of Economic Opportunity. The cuts are at one location in Tampa.
More than 100 of the impacted employees are processing agents. The rest are team leaders and a team manager.
Wipro sent us the following statement:
“Wipro has reduced headcount in Tampa due to a realignment of business needs. This is an isolated incident. Wipro remains deeply committed to the region. And all other Wipro employees serving clients in the Tampa area remain unaffected.”
Wipro provides IT, consulting and business process services.