Salesforce said Wednesday it will cut about 10% of its workforce — around 7,000 employees — and close some offices as part of a cost-cutting drive.
"The environment remains challenging and our customers are taking a more measured approach to their purchasing decisions," co-CEO Marc Benioff said in an email to staff on Wednesday morning. "With this in mind, we've made the very difficult decision to reduce our workforce by about 10%, mostly over the coming weeks."
Affected employees were due to receive an email within an hour of the announcement, Benioff said. Laid-off staff in the US would get close to five months of pay, health insurance, and career resources, he added.
Benioff attributed the layoffs to over-hiring during the pandemic. "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," he said.
As of January 31, 2022, Salesforce had 73,541 employees, with 55% based in the US.
The layoffs form part of a restructuring that Salesforce said would reduce costs and improve operating margins.
The company said in a regulatory filing that it expected to spend between $1 billion and $1.4 billion on employee transition, severance payments, employee benefits, and share-based compensation, and a further $450 million to $650 million on exit charges related to its office space reductions.
This is a developing story. Please check back for updates.