Big technology companies to spend more than $10bn on staff cuts
Big technology companies to ...
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Big technology companies to spend more than $10bn on staff cuts

3 February 2023
3633
2 min.
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Big technology companies to spend more than $10bn on staff cuts

Staffing at major tech companies

Amazon, Meta, Alphabet and Microsoft will collectively spend more than $10bn due to massive layoffs and other austerity measures. The Financial Times reported this on Friday, citing earnings reports.

It said the companies making the biggest job cuts in the technology sector have disclosed the high costs associated with their restructuring efforts. The four corporations in question had previously announced 50,000 job cuts.

Despite the companies' high upfront costs, including severance payments, investors appear encouraged by the measures, the newspaper said. Since the cuts were officially announced, the companies have collectively increased their market capitalisation by more than $800bn. Meta's value has almost doubled since the job cuts were announced in November.

It is worth noting that according to Layoffs.fyi, a tracker that records tech layoffs, nearly 250,000 employees have been laid off in the sector since the start of last year.

Apple remains the only major technology company that has not announced job cuts or a cost-cutting programme, even though it reported its first quarterly revenue decline in three and a half years on Thursday, the Financial Times noted.

Microsoft's planned savings, which include the elimination of 10,000 jobs, resulted in $1.2 billion in costs in the last three months of 2022, $800 million of which came from severance packages.

Salesforce, which will not report earnings until March, is expected to be another company facing significant restructuring costs, having announced last month it was cutting its workforce by 10%. The move comes after activist investor Elliott Management acquired a multi-billion dollar stake in the company, saying it intends to "work constructively with Salesforce to realise value befitting a company of this scale".

Similarly, Alphabet attracted the attention of activist Sir Christopher Anthony Hohn of TCI Fund Management, who wrote to CEO Sundar Pichai, saying it needed to make further headcount cuts and cut "excessive employee compensation".

Persons2 and Companies9 in the news

Founder of The Children's Investment Fund Management
1 place
CEO of Google (Alphabet Inc)
2 place
Layoffs.fyi
2 place
Meta Platforms
3 place
Microsoft
6 place
Salesforce
7 place
Amazon
9 place
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