Informatica Cutting Its Workforce By 7 Percent Or About 450 Employees
The big data management tech company is also making a change in its CFO post, but reaffirming its financial guidance for its upcoming Q4 report.
Informatica is cutting its staff by about 450 employees or about 7 percent of its workforce, according to a company filing with the U.S. Securities and Exchange Commission.
Under the cost-cutting plan disclosed in the Form 8-K filed with the SEC this week, Informatica is reducing its workforce by “approximately 450 employees,” representing approximately 7 percent of the company’s current global workforce. Informatica currently has more than 5,500 employees worldwide.
“The plan is intended to better align the company’s global workforce and cost base with its cloud-focused strategic priorities and current business needs,” the 8-K stated.
[Related: Informatica Extends AWS Alliance With Tighter Data Management Integration]
The enterprise cloud data management software developer also said that current Chief Financial Officer Eric Brown is stepping down and will be replaced by Michael McLaughlin, who takes over as Informatica CFO and executive vice president effective Jan. 16.
The company said the layoffs “will be substantially complete by the end of the first quarter of 2023.” The move will result in non-recurring charges of approximately $25 million to $35 million, mostly incurred in the first quarter.
Informatica is the latest IT vendor to undertake significant cuts in its workforce. Earlier this week Cloud Software Group, the parent company of Citrix and Tibco, cut about 15 percent of its workforce in an effort to streamline operations after the two companies were combined into CSG by their private equity owners.
Other IT companies laying off workers in recent months include Amazon, Saleasforce and Intel.
Informatica, based in Redwood City, Calif., is a leading developer of data management software, including its flagship Intelligent Data Management Cloud, with a product portfolio that spans data integration, data governance, data catalog and other capabilities.
“To fully transition to a cloud organization we must be nimble, which means removing layers, simplifying our structure, and being laser focused on cloud-oriented execution,” CEO Amit Walia said in a blog post announcing the cutbacks. “At the same time, the environment remains challenging, and our customers are taking a more measured approach to their purchasing decisions. Finally, as we pivot to a cloud only business, we continue to remain committed to serving our on-prem solutions for existing customers including helping them transition to the cloud.
“So today I am sharing the difficult news that we are eliminating positions or entering the consultation process in several business functions which will impact approximately 7% of our very talented colleagues. We will reach out to impacted individuals and our global team this morning and, consistent with our Values we will act with the utmost compassion and respect throughout this process. Departing colleagues will receive generous financial, health and career resources to support them through their transition,” the CEO said.
On LinkedIn a former “senior manager iPaaS specialists” in North America said he was looking for work after eight years and five months at Informatica. Another employee, a director of presales, said on LinkedIn that “[b]eing a part of this layoff truly is bittersweet...leaving a company and group of people I have grown to think of as family is tough, but the opportunities in front of me I know are vast and exciting.” Another employee, a data privacy product specialist, took to LinkedIn to say he received a layoff notice after working 16 years at the company.
Informatica, in a statement, said that Brown, who has held the CFO post for more than four years, “has notified the Informatica Board of Directors of his intention to step down to pursue other opportunities.”
The company has hired Michael McLaughlin, most recently CFO at FICO, as its new CFO and executive VP, effective Jan. 16. Brown will continue as a consultant through March 31.
For the first three quarters of 2022 Informatica, which went public for the second time in 2021, reported revenue of $1.11 billion, up nearly 7 percent from the same period one year before.
The company is scheduled to announce its 2022 fourth-quarter and full-year results on Feb. 8. In addition to announcing the CFO transition, the company this week reaffirmed its previous guidance of $1.505 billion to $1.515 billion in total revenue for the year. Early in 2022 the company set a goal of achieving $1 billion in annual recurring revenue.
Updated at 10:02 a.m. ET 1/13 with CEO Amit Walia comments.