Salesforce to cut staff by 10% in latest tech layoffs

[groundloop]

Source: Reuters

Salesforce Inc (CRM.N) said on Wednesday it would lay off about 10% of its employees and close some offices, becoming the latest tech firm to undertake cost cuts amid an economic slowdown.

The company expects the move to lead to about $1.4 billion to $2.1 billion in charges, of which about $800 million to $1 billion will be recorded in the fourth quarter of fiscal 2023.

"The environment remains challenging and our customers are taking a more measured approach to their purchasing decisions," co-Chief Executive Officer Marc Benioff said in a letter to employees.

Companies from Meta Platforms Inc (META.O) to Amazon.com Inc (AMZN.O) have in the past year taken steps to prepare for a deep downturn as global central banks have aggressively raised interest rates to tame decades-high inflation.

Read more: https://www.reuters.com/technology/salesforce-cut-staff-by-10-close-some-offices-2023-01-04/

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It looks like all of this recession talk might become a self fulfilling prophesy thanks to companies cutting employment in order to protect their profits (and their CEO salaries).

[IronLionZion]

1. Tech firms highly leveraged their growth

so they are impacted directly by higher interest rates. And Salesforce does CRM software which is impacted by lower demand for their product and sales in general. They claim there is less demand for cloud services but I'm not so sure. I personally use cloud more than ever now but I suppose it varies by industry.

[Casady1]

2. I don't consider

Amazon and Meta high tech SAAS companies. I consider them advertising companies. I work in high tech.

[IronLionZion]

4. Amazon Web Services is about a 3rd of the global cloud service market

Meta's value is in their tremendous amount of customer data. So I would agree they are advertising.

[Casady1]

5. I work in high tech

and we use AWS. I know it well. I still consider both companies not really high tech. I think of high tech as SAAS. To me Amazon is a retail company and Meta is an advertising company.

[Lonestarblue]

3. Looks like the Fed will get the recession they want.

Economist Paul Krugman has an interesting article in the NYT today that’s well worth reading. Krugman describes a recent conversation with top economists who have differing viewpoints about the cause of our inflation and what to do about it. Several disagreed with FED policy, which focuses only on curbing demand.

“The discussion was kicked off by Olivier Blanchard, the former chief economist of the International Monetary Fund (a towering figure in the profession, who happens to be one of the economists who has gotten recent inflation more or less right).

He started off by making a point that he said is “often lost in discussions of inflation and central bank policy.” He went on: “Inflation is fundamentally the outcome of the distributional conflict, between firms, workers and taxpayers. It stops only when the various players are forced to accept the outcome.”

Krugman goes on to use an exciting football game as an analogy for a hot economy, equating an exciting game with an economy where businesses are profitable and workers are making gains. What the FED is doing is making the game boring and forcing companies to lay off workers while also taking away worker gains by forcing the economy into recession. Several economists have written that there are better ways to tame inflation because the FED policies hurt the very people who can least afford to lose their jobs or see their wages decrease. This link is not behind a paywall.

https://www.nytimes.com/2023/01/03/opinion/inflation-economy.html?unlocked_article_code=clmMckeAtUpX9vY1UKlr2_v8SuBVN9jwSEcFWk7kIdgQixjyNQtCRFqPFH1a5yYehBNKId1n2x5O0E5hqEuULDTMEiczwqq2ALJS9Y-jm9p8R53PBESrJXLnIhFzSIIfnyGE4aYRmpbKbW9us4YfrHMPNyjSdWdUoz0RDxFLim1hD1EoQiQSc0wxfQYct2jr_v5CfOVWonA12f7Vg-Z_ynH4RGcEPWZ7o9GQx1a7aXGo5sEeGglhJ0DgIdjMvqyTO_FsOriq09dDBy5TjoN0_59pY9O5phMBN5Gb7BqYbbRnNpWMfewFOkmSRaWKMCJYV2NKWSCBxP-hX5k&smid=share-url

[Backseat Driver]

10. Hey Krugman

"Krugman goes on to use an exciting football game as an analogy for a hot economy, equating an exciting game with an economy where businesses are profitable and workers are making gains. What the FED is doing is making the game boring and forcing companies to lay off workers while also taking away worker gains by forcing the economy into recession. Several economists have written that there are better ways to tame inflation because the FED policies hurt the very people who can least afford to lose their jobs or see their wages decrease."

So sorry; there's just no respect anymore - BTW, welcome to DU!

Really, Krugman, evidently the answer is to have a healthy young player drop dead by way of a rare disorder on the tournament field of debt to allow the fat cats more time to sell ads. Must be a lot of black screen 30 second spots as we approach the NFL Superbowl. It's a cheap shot to hire McConaughey pitching "The New Frontier" - or was that last year's come on???

It's always really bad when the a game clock just stops, and officials never call a "delay of game" penalty while owners choose to suspend it altogether so they can re-shuffle the schedule and sell more ads. Are Superbowl selling spots going dark and fan seats going empty. I think the word was just too "traumatizing."

[luxmatic]

6. What a lovely start to my day

See this headline on DU, check my email, and find my 16 year career at Salesforce is now over.

[DJ Porkchop]

7. Sorry you're out of work, but there are some great opportunities awaiting you.

Stay positive. This could be great news!

[hibbing]

8. Damn, that sucks, hang in there n/t

[Casady1]

11. Are you on the sales side

or the back office support?

[luxmatic]

12. Sr. Director of Engineering

Was a Principal Member of Technical Staff until a couple of years ago.

[Casady1]

13. My friend is head

of the ecommerce side of SF.(Genna Gwynn). That being said you should be attractive to the valley. My nephew used to run the MS CRM application.
You probably don't want to work for MS. If I can think of someone who needs a Director of engineering I'll let you know. I'm in high tech.

[luxmatic]

14. Thank you!!!

It can't hurt to post this: https://www.linkedin.com/in/dmbrady/

[Casady1]

15. Let me see what I can do.

Like I said I am in high tech. I don't think Twitter is hiring.

[Skittles]

16. ?

they notified you via EMAIL?

[Kennah]

9. I wonder how much they're paying Matthew McConaughey