Salesforce is cutting 10% of its employees

Salesforce is cutting 10% of its personnel and reducing some office space as part of a restructuring plan.

Salesforce The cloud-based software company, announced on Wednesday that it will be reorganizing its workforce and reducing some of its office space by 10%. As of December, the corporation employed about 79,000 people.

In a letter to staff members, co-CEO Marc Benioff stated that given the adverse financial environment, customers have become more “measured” in their purchase decisions, which has forced Salesforce to make the “very difficult decision” to lay off employees.

“I’ve been thinking a lot about how we came to this moment,” Benioff wrote. “As our revenue accelerated through the pandemic, we hired too many people leading into this economic downturn we’re now facing, and I take responsibility for that.”

Salesforce will record charges of $1.0 billion to $1.4 billion related to the headcount reductions, and $450 million to $650 million related to the office space reductions, the officials said.

lay off after hiring ‘too many people’ during the pandemic;

The tech industry, which was first boosted by a sudden and significant shift to online services caused by the pandemic, has since had to deal with consumers going back to their offline life. At the same time, the industry has suffered over the past year from what seems to be a perfect storm of economic variables, including rising interest rates, worries about an impending recession, and consumers’ and businesses’ rethinking expenditures.

Also on Wednesday, the video-sharing website Vimeo announced it would lay off about 11% of its staff in a regulatory filing.

several tech companies, including Amazon and Meta, announced mass layoffs.

Many other tech founders and CEOs, including Benioff, have now acknowledged they misjudged pandemic demand. As a result, several tech companies, including Amazon and Meta, announced mass layoffs.

The cloud computing giant “clearly is encountering challenges in the field and is trying to fast respond to a softening demand environment,” Wedbush Securities analyst Dan Ives wrote in an investment note on Wednesday. Along with the rest of the tech sector, the company “clearly overbuilt up its organization over the past five years,” the analyst continued.

Following the news, Salesforce (CRM) shares increased by more than 3% in early trade on Wednesday.

What other benefit will be provided to layoffs employees;

The affected employees in the United States will “get a minimum of roughly five months of pay, health insurance, career resources, and other benefits to help with their transition,” according to Benioff’s letter issued Wednesday. People living abroad “will receive a similar level of support,” according to Benioff.

The affected workers are more than just coworkers, according to Benioff. They are friends,  They are family. Please get in touch with them. Give them and their family the compassion and love they deserve and need more than ever. Please lean on your leadership, which includes me, as we work through this challenging period together.

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