The year 2023 witnessed significant upheaval in the tech industry, with several prominent companies facing declining revenue and increased economic uncertainty. As a response to these challenges, many tech giants embarked on extensive cost-cutting measures, including substantial layoffs across various sectors. This piece delves into the details of the major tech layoffs of 2023, exploring the reasons behind them and their implications for the affected companies and the wider industry.
June 16: Despite growth, Oracle reported to cut jobs at Cerner healthcare unit
Oracle laid off hundreds of employees and rescinded job offers for its Cerner healthcare unit, acquired earlier this year for $28 billion, according to a report by Insider. The layoffs were reportedly due to problems with Cerner’s project for the US Department of Veterans Affairs Office. The VA has raised concerns about technical glitches and patient safety issues with its new electronic health record system, and the layoffs cast a shadow over Oracle’s optimistic outlook for Cerner. Company executives expect Cerner to be a crucial factor in future growth, considering the healthcare industry’s ongoing digital transformation as the sector adopts electronic healthcare records. Just days before the Cerner layoffs came to light, Oracle announced that quarterly cloud revenue experienced a significant surge, increasing 54% year-over-year and contributing to record sales for the fiscal year.
June 14: Phoenix-based Nikola Corporation said it has cut 120 employees based in Arizona and another 150 across “multiple sites” supporting the company’s programs in Europe, as part of a reorganization plan intended to save more than $50 million per year and as the company looks to consolidate its operations.
June 14: Sonos, the maker of wireless multi-room sound systems, announced its layoffs in a Securities and Exchange Commission filing, saying the cuts will affect roughly 130 employees (7% of its workforce ) and the company will re-evaluate its spending and real estate footprint, as it faces “continued headwinds.”
June 13: Nearly 230 employees laid off at Tyson Foods had been working at two of the company’s Illinois offices and rejected the company’s request in October to relocate to Arkansas —Tyson had cut another 15% of senior leadership positions and 10% of its roughly 6,000 corporate jobs in April, according to regulatory filings, and announced plans in March to shut two plants in Arkansas and Virginia and cut roughly 1,600 employees.
June 12: Grubhub’s cuts will affect roughly 400 of the company’s 2,800 employees, CEO Howard Migdal—just three months into his role—said in an internal memo, citing high staffing and operating costs that have grown “at a higher rate” than its overall business since pre-Covid levels.
June 5: Spotify Vice President Sahar Elhabashi announced in a notice to employees the audio streaming giant will cut 200 employees (2% of its workforce) as part of a “strategic realignment,” sending its stock up nearly 0.6% to $152.60—the streaming service previously cut another 6% of its staff (600 positions) in January.
June 2: Haven Technologies, the MassMutual-owned insurance software company, will cut roughly 280 employees in a massive round of cuts affecting roughly 70% of the company’s workforce, telling Forbes the cuts are part of a reorganization plan to leave Haven Technologies “best positioned to create the flexible and customer-centric technologies that will enable our clients to help expand access to insurance.”
June 1: ZipRecruiter announced in a Securities and Exchange Commission filing the company will cut its workforce by 270 employees (20% of its staff), in response to “current market conditions and after reducing other discretionary expenses.”
June 1: Zendesk to lay off another 8% of its staff, cites macroeconomic issues
CRM software provider Zendesk implemented a new round of layoffs, reducing its workforce by a further 8% due to ongoing macroeconomic uncertainty and increased competition from rivals. The move came just six months after the company laid off 300 employees for similar reasons. CEO Tom Eggemeier announced the decision in an email to all employees, which was later posted as a blog. Eggemeier highlighted the need to align the company’s employee structure with customer goals, as enterprise customers consider adopting newer technologies like generative AI. Eggemeier said he believes Zendesk has an opportunity to lead in the new era of intelligent customer experience (CX), with solutions such as Zendesk AI and Conversational Commerce.
May 11: Developer-focused portal Stack Overflow lays off 10% of staff
Stack Overflow, the question-and-answer portal for developers, announced that it will lay off 10% of its workforce, affecting at least 58 employees. The job cuts come as the company shifts its focus to profitability amid macroeconomic concerns, according to a blog post by CEO Prashanth Chandrasekar. Affected employees include UX designers, HR professionals, product designers, and senior software developers. To improve profitability, Stack Overflow plans to launch AI and ML-based offerings in the coming months. This move is likely in response to demand from enterprises for generative AI and natural language processing capabilities, as vendors like AWS, IBM, and Google have launched new product offerings in this space.
May 9: LinkedIn lays off 716 staffers, to shut China job app
Employment-focused social media platform LinkedIn on Tuesday said it would let go of 716 staffers as it shuts down a job search app in China and prepares for tapering revenue growth. According to a letter to employees from CEO Ryan Roslansky, the layoffs were designed to reorganize the company and become more agile. He noted that the company had experienced shifts in customer behavior and slower revenue growth in recent months. In addition to the layoffs, the company will spin up 250 new roles in specific segments of its operations, new business, and account management teams starting May 15. The company will also phase out the local job app InCareer by August 9, 2023, as part of its business strategy changes in China.
May 4: Cognizant cuts 3,500 jobs in post-COVID, hybrid work restructuring plan
Technology services and consulting company Cognizant is set to cut around 1% of its global workforce, or approximately 3,500 employees, in a bid to reduce costs. Despite posting a 3% increase in net profit year-on-year for its most recent quarter, Cognizant CEO Ravi Kumar said the company was monitoring an uncertain macroeconomic environment and potential shifts in client priorities. The job cuts are part of the company’s NextGen program, which aims to simplify its operating model and realign office space. Cognizant has not confirmed where the affected workers are based, but it did say the cuts would mostly affect non-billable roles. In a statement, Cognizant said the changes reflect the post-pandemic hybrid work environment, and its drive for simplification includes operating with fewer layers to enhance agility and enable faster decision-making.
April 27: Dropbox lays off 16% of staff to refocus on AI, as sales growth slows
Facing a slowdown in revenue growth, cloud storage company Dropbox announced that it is laying off 500 employees, or 16% of its workforce, mainly in order to be able to hire staff with AI expertise. Although revenue for the fourth quarter last year — the last quarter for which Dropbox reported earnings — was up by 5.8% year over year to $598.8 million, the company has experienced a slowdown in sales recently. Meanwhile, in order to stay competive, the company needs to ramp up its AI capabilities, CEO Drew Houston said in note to employees.
April 24: Red Hat cuts 4% of global staff
Enterprise Linux giant Red Hat announced it will lay off almost 4% of its global staff, or about 800 workers, noting that the cuts will affect general administrative staff, not technical workers or sales people. The company has helped boost sales for corporate parent IBM, which reported that in the first quarter of the year, Red Hat revenue jumped 8% year over year. Despite the sales growth Red Hat CEO Matt Hicks said that a staff restructuring was necessary to ramp up efforts to bolster the company’s open hybrid cloud strategy, particularly for the industries including telecommunications and automotive.
April 20: Technical teams hit by Meta’s latest wave of layoffs
Facebook’s parent company, Meta, initiated another round of layoffs. These were previosuly announced — the difference this time is that many of the cuts reportedly affect technical employees. The latest wave of job cuts will see approximately 4,000 employees laid off from the company, including those in user experience, software engineering, graphics programming, and gameplay programming. The timeline for the cuts may differ, depending on the locations employees, Meta said. Instagram, a Meta subsidiary, is also downsizing or relocating UK-based staff, with the app’s head, Adam Mosseri, moving back to the US.
March 30: Kyndryl lays off staff in search of efficiency
Kyndryl, the managed IT services provider that spun out of IBM, announced layoffs affecting its internal IT services to streamline operations and become more competitive. The exact number of affected employees was not disclosed, but anonymous comments on job-loss monitoring website The Layoff.com suggested that staff in IT asset management roles and Kyndryl’s own CIO organization were among those let go. Kyndryl, which employs 90,000 globally, has been facing declining revenue and slow growth since its separation from IBM.
March 23: Accenture to lay off 19,000 to cut costs amid economic uncertainty
IT services and consultancy firm Accenture announced it would lay off 19,000 employees, or 2.5% of its workforce, over the next 18 months to reduce costs amid uncertain economic conditions. Tech workers were expected to be largely spared though, as the company said the cuts would primarily affect non-billable corporate functions. The decision came as demand for services stabilized following post-pandemic growth, and Accenture also lowered its fiscal year 2023 revenue growth forecast. Despite the reduced forecast, Accenture’s diversified business and industry mix is expected to provide stability for the tech services giant.
March 20: Amazon to lay off 9,000 more workers, including some at AWS
Amazon said it plans to lay off about 9,000 more workers from several business units, including AWS, PXT (People Experience and Technology, the company’s HR arm), Advertising, and Twitch. The announcement came two months after Amazon unveiled plans to lay off 18,000 employees. AWS is a big revenue generator for Amazon but has not been immune to current macroeconomic conditions. Revenue growth slowed sharply in the fourth quarter of 2022, to 20% in year-on-year terms. That’s well below the 27.5% and 33% figures seen in the previous two quarters.
March 14: Meta cuts an additional 10,000 jobs from global workforce
Four months after social media giant Meta confirmed that it would cut 13% of its global workforce — amounting to 11,000 jobs — the company announced a further 10,000 layoffs. Additionally, Meta said that it would leave 5,000 currently empty roles unfilled. Founder and CEO Mark Zuckerberg cited difficult macroeconomic conditions and a focus on “flattening” the company’s organizational structure as key factors in the decision to cut more staff.
March 7: Atlassian lays off 5% of staff to refocus on cloud, ITSM
Collaboration software company Atlassian said that it plans to fire 500 employees, or around 5% of its overall workforce. The Australia-based company said that the job losses were organizational, and not driven by a need to cut costs — despite posting a net loss in its February financials, Atlassian saw its revenue grow 27%, to $873 million in the last quarter.
Feb. 27: Twitter stealthily lays off 10% of remaining workers, including tech staff
This round of Twitter layoffs saw the embattled social media platform lose 10% of its remaining workers, as about 200 were fired. The layoffs included startup founders whose companies had been absorbed by Twitter, including Esther Crawford, most recently the head of Twitter Blue. Twitter has fewer than 2,000 workers left on staff, down from about 7,500 just before Elon Musk bought the company in late October 2022.
Feb. 13: Twilio announces fresh round of layoffs, impacting 17% of its workforce
Twilio announced that it would slash its workforce by roughly 1,400, months after laying off an additional 816 during the fourth quarter of 2022. The cloud communications company said also that it would reorganize internally, creating two new business units, Twilio Communications and Twilio Data & Applications, in an official blog post. Before these two recent rounds of layoffs, the company employed nearly 9,000 workers.
Feb. 10: Microsoft cuts HoloLens, Xbox, Surface jobs as industrial metaverse team said to fold
Microsoft confirmed that it is cutting employees working on its HoloLens, Surface laptop and Xbox products, as reports surfaced that the tech giant will be laying off 100 employees working for its industrial metaverse team and closing that unit. The move to cut staff working on HoloLens and in its industrial metaverse team came as a surprise since the the company had made recent moves to expand efforts to move its augmented reality, virtual reality and metaverse initiatves from the consumer to the enterprise side. In a statement, though, Microsoft said it was committed to the industrial metaverse. The company did not specify how many jobs it would cut in those areas, though a Worker Adjustment and Retraining Notification (WARN) from Washington state Friday noted that Microsoft had reported that 617 employees would be laid off in Redmond, Bellevue and Issaquah.
Feb. 10: Yahoo to lay off 20% of its staff as it cuts advertising tech business
Yahoo said it will lay off about 20% of its staff, or apporximately 1,600 workers, by the end of year, according to media reports confirmed by the company. The move is aimed at restructuring the company’s advertising technology business unit and reallocating its finances more efficiently. The layoffs mark the end of Yahoo’s attempts to be a direct competitor to Google and Meta in the digital advertising market.
Feb. 9: GitHub lays off 10% workforce, plans to go fully remote to cut costs
Microsoft-owned software development and version control service provider GitHubowned by Microsoft said it would be cutting 10% of its workforce, or about 300 employees, and moving the remaining staff to remote work in order to safeguard the company’s immediate financial stability. The layoffs came about a month after the company enacted a hiring freeze.
Feb. 7: Zoom lays off 15% of its workforce after growth spurt during pandemic
Cloud-based videoconferencing service provider Zoom said that it was laying off 15% of its workforce, fearing uncertain macroeconomic conditions. The move came after the company went on a hiring spree during the pandemic.
In addition, Zoom said it is also making changes in team structure and several members of its leadership team will take pay cuts.
Feb. 6: Dell Technologies to lay off 6,650 staffers
Due to declining PC sales and infrastructure requirements, Dell Technologies said it would lay off 6,650 workers, or about 5% of its total workforce. In addition to the downsizing, Co-Chief Operating Officer Jeff Clarke said the company would introduce changes that include changing the structure of its sales team and integrating the services division of its consumer and infrastructure businesses.
Feb. 2: Splunk to lay off 4% of its workforce to reduce costs
In a company filing with the US Securities and Exchange Commission (SEC), Splunk said it would be laying off 4% of its workforce as part of broader measures to optimize costs and processes ahead of uncertain macroeconomic conditions. The decision to downsize will affect 325 employees at the company, mostly in the North America region.
Feb. 1: PayPal to lay off 2,000 employees
In a message shared with PayPal employees and posted on the company’s online newsroom, PayPal President and CEO Dan Schulman said the company was set to cut 2,000 jobs, about 7% of its workforce.
Although the company beat analyst expectations in November when it reported its third quarter financial results, PayPal downgraded its forecast for the fourth quarter, citing a challenging macro environment and slowing e-commerce trends.
Jan. 26: SAP announces 2,800 job cuts, says they’re unrelated to over-hiring or performance
Despite revenue rising 11% in 2022, during an announcement about its fourth quarter financial results, SAP said that due to net income dropping by 68%, the company would be undertaking some restructuring, resulting in layoffs.
Whereas companies such as Google or Salesforce announced across-the-board layoffs based on performance review criteria to reverse over-hiring during the pandemic period, CEO Christian Klein said that the job cuts are part of “a targeted restructuring” and not performance-based.
“We definitely didn’t over-hire,” Klein said, noting that revenue grew faster than SAP employee growth in 2022.
Jan. 26: IBM cuts 3,900 remaining employees after double asset disposal
After spinning off most of its infrastructure management division as a new business, Kyndryl, in November 2021, and selling some assets of its Watson Health business in January 2022, on the same day as IBM’s Q4 2022 results were announced, the company said it was eliminating 3,900 job roles, or 1.5% of its global workforce.
On a conference call with analysts to discuss the results, CFO Jim Kavanaugh didn’t directly mention the job cuts, instead alluding vaguely to the situation by acknowledging the business would have some “stranded costs” to address in early 2023, resulting in a “modest” charge of about $300 million
Later that day, in an interview with Bloomberg, Kavanaugh explained that those stranded costs related to staff left with nothing to do following the asset disposals and as a result, they would be laid off from the company.
In a statement, a spokesperson for IBM said it was important to note the charge is entirely related to the Kyndryl spinoff and healthcare divestiture.
Jan. 20: Google announces it’s cutting 12,000 jobs globally
Google’s parent company Alphabet announced it was cutting 12,000 jobs, around 6% of its global workforce. An internal memo from Sundar Pichai said that he takes “full responsibility for the decisions that led us here.”
The company will be paying affected employees at least 16 weeks of severance and six months of health benefits in the US, with other regions receiving packages based on local laws and practices.
The news comes four months after Alphabet posted lower-than-expected numbers for its third financial quarter, where it fell behind both revenue and profit expectations. However, while overall revenue growth slowed to 6% in the quarter for Alphabet, Google Cloud grew 38% year-on-year to $6.9 billion.
Jan. 18: Microsoft CEO Satya Nadella confirms plan to lay off 10,000 workers
On Jan. 18, Microsoft CEO Satya Nadella confirmed in a blog post that the company would be cutting almost 5% of its workforce, impacting 10,000 employees.
The chief executive chalked up the downsizing maneuver to aligning its cost structure with its revenue structure while investing in areas that the company predicts will show long-term growth.
The Seattle-based tech giant reported its slowest growth in five years for the first quarter of its fiscal 2023, due largely to a strong US dollar and an ongoing decline in personal computer sales, causing net income to fall by 14% to $17.56 billion from this time last year. Rising cloud revenue helped to soften Microsoft’s growth slowdown.
Jan. 16: Google-backed ShareChat lays off 20% of staff
Google-backed, India-based social media startup ShareChat said it is laying off 20% of its workforce to prepare for oncoming economic headwinds.
“The decision to reduce employee costs was taken after much deliberation and in light of the growing market consensus that investment sentiments will remain very cautious throughout this year,” a spokesperson said.
The move is expected to impact over 400 employees out of the company’s approximately 2,200 staffers. The company did not disclose the roles and the exact number of workers affected by the decision.
Jan. 13: Alphabet robotics subsidiary Intrinsic lays off 20% of staff
Alphabet, Google’s corporate parent, also announced there would be layoffs at its Mountain View, California-based robotics subsidiary Intrinsic AI, eliminating around 20% of its workforce or roughly 40 employees.
“This (downsizing) decision was made in light of shifts in prioritization and our longer-term strategic direction. It will ensure Intrinsic can continue to allocate resources to our highest priority initiatives, such as building our software and AI platform, integrating the recent strategic acquisitions of Vicarious and OSRC (commercial arm Open Robotics), and working with key industry partners,” according to a company statement.
Jan. 12: Alphabet-owned Verily cuts 15% of workforce
Verily — a life sciences firm also owned by Alphabet and headquartered in San Francisco — is downsizing its workforce by 15% to simplify its operating model. The move comes just months after the company raised $1 billion.
According to an email sent by CEO Stephen Gillett to all its employees, the downsizing is part of the company’s One Verily program, which aims to reduce redundancy and simplify operational aspects within the company.
As part of the new One Verily program, the company said it will move from multiple lines of business to one centralized product organization with increasingly connected healthcare systems.
Jan. 11: Informatica to lay off 7% of its workforce to cut costs
Enterprise data management firm Informatica announced plans to lay off 7% of its total workforce through the first quarter of 2023, the company said in a filing with the US Securities and Exchange Commission.
The move by Informatica, headquartered in Redwood City, California, will incur nonrecurring charges of approximately $25 million to $35 million in the form of cash expenditures for employee transition, notice period, severance payments and employee benefits, the company filing showed.
The company said it expects the layoffs to be completed by the first quarter of 2023 but added that there might be limited exceptions.
Jan. 4: Salesforce to cut 8,000 in restructuring plan
At the beginning of 2023, San-Francisco based Salesforce announced it will lay off about 10% of its workforce, roughly 8,000 employees, and close some offices as part of a restructuring plan.
In a filing with the US Securities and Exchange Commission (SEC), the company disclosed that its restructuring plan calls for charges between $1.4 billion and $2.1 billion, with up to $1 billion of those costs being shouldered by the company in the fourth quarter of 2023.
In a letter sent by Salesforce’s co-CEO Marc Benioff and attached to the SEC filing, he told employees that as Salesforce’s revenue accelerated through the pandemic, the company over-hired and can no longer sustain its current workforce size due to the ongoing economic downturn. “I take responsibility for that,” Benioff said.
Jan. 4: Amazon confirms more than 18,000 employees to be laid off
Seattle-based tech behemoth Amazon said it would be laying off more than 18,000 staff, with the bulk of job cuts coming later this month. The news confirmed a December Computerworld article reporting that Amazon layoffs were expected to mount to about 20,000 people at all levels While several teams are impacted, the majority of the job cuts will be in the Amazon Stores and People, Experience, and Technology (PXT) organizations.
According to a note from CEO Andy Jassy, the layoffs are a result of “the uncertain economy.” He also said that Amazon had “hired rapidly over the last several years,” but added that the layoffs will help the company pursue more long-term opportunities with a stronger cost structure.