Tech Company Layoffs In 2023: Cuts Continued In Q4
VMware, Twilio, HPE and Qualtrics were some of the tech companies that cut their workforces in the most recent quarter.
Tech company layoffs continued to roll in during the fourth quarter of 2023 as the industry battled a challenging macroeconomic environment.
Nokia, VMware, Qualtrics and HPE were some of the tech companies cutting their workforces this quarter. So far this year, there have been 259,703 layoffs at companies, according to Layoffs.fyi, a website that tracks layoffs. That’s an increase from 2022’s 164,969 total layoffs, according to the site.
Despite the cuts, the U.S. unemployment rate stood at 3.7 percent in November, a dramatic improvement from the onset of the COVID-19 pandemic, when demand for IT began to spike. Now with massive IT spending triggered by the pandemic in the rearview mirror, many companies in the industry have been forced to rein in their own expenses as IT demand has moderated.
CRN has been tracking tech industry layoffs this year. Check out coverage from last quarter.
What follows is a list of some of the tech companies that implemented layoffs in the fourth quarter of 2023. With a few more days left this year, there’s always the possibility of more layoffs before 2023 ends.
Qualtrics Cuts More Than 700 Employees
Seattle-based software firm Qualtrics cut 14 percent of its workforce in October. The 780-person layoff is to reduce costs and restructure its organization due to an “internal complexity” from past rapid hiring. Qualtrics has 550 employees before the layoffs.
“We've now come to a day that is painful, but also necessary to achieve our next phase of growth at scale,” Qualtrics CEO Zig Serafin, wrote in a memo on the company’s website. “We’ve made the difficult decision to eliminate approximately 780 roles across the company. Additionally, several hundred roles are changing or moving locations over the next year. In doing so, we will comply with all local consultation requirements related to these changes.
“Rapid hiring was essential to enable our growth up to this point, but it also created complexity that does not support continued growth at our scale,” he continued. “Simply put, the organizational structures, work processes and the way we made decisions previously don’t work for the company we’ve become, or the company we aspire to be.
“The changes we’re making—which touch every team at the company—are necessary for us to capture the massive opportunity in front of us given our significant market momentum and the mission critical nature of our XM platform. To get here, we conducted a deep review of every function in the company.”
Nokia Cuts 14,000
Finnish telecom company Nokia laid off 14,000 of its 86,000 workforce in October. The move was aimed at saving the company about $421.4 million in 2024 alone.
The 10 to 15 percent reduction in its workforce was expected to cut Nokia’s costs by about $1.3 billion cumulatively by the end of 2026. At its Q3 earnings call in October, Nokia reported a net sales decline of 15 percent year-over-year in constant currency as macroeconomic uncertainty and higher interest rates continue to pressure operator spending.
“Our third quarter performance demonstrated resilience in our operating margin despite the impact of the weaker environment on our net sales,” Pekka Lundmark, Nokia president and CEO, said in a Q3 earnings statement. “In the last three years we have invested heavily to strengthen our technology leadership across the business giving us a firm foundation to weather this period of market weakness.”
He said that cloud computing and AI will not materialize without significant investments in networks that have vastly improved capabilities.
“However, given the uncertain timing of the market recovery, we are now taking decisive action on three levels: strategic, operational and cost,” he said. “I believe these actions will make us stronger and deliver significant value for our shareholders.”
HPE Cuts Sales Jobs
Spring, Texas-based Hewlett Packard Enterprise’s sales team in North America was hit with layoffs in October even as the company planned to hire new sales specialists to enhance core market-share gains in compute, storage and artificial intelligence.
Roles affected by the cuts include some territory account managers, enterprise account managers and partner business managers. The amount of roles cut were unknown.
HPE Chief Sales Officer Heiko Meyer, who oversees the worldwide sales force, told CRN that the new structure comes as HPE is ready to gain share and pivot business in a post-pandemic world.
“Partners will see on the one side more resources from us and on the other side they will see us much more aggressive competing in the market,” he said.
Exabeam Cuts 20 Percent Of Staff
Exabeam said it would cut about 20 percent of its workforce in late October to “strengthen our financial health as we navigate global macroeconomic headwinds,” said CEO Adam Geller in a blog post.
The restructuring “will better align departments across the company for operational efficiency and continued innovation,” he said in a Wednesday post. It was not immediately clear how many employees Foster City, Calif.-based Exabeam had before the layoffs.
“Continuing and challenging macroeconomic conditions made it clear that we needed to make necessary course corrections,” he said. “This is not a decision we took lightly, but one that is essential for the financial health of the business.”
Amazon Cuts 180
Seattle, Wash.-based Amazon cut several hundred jobs in its Alexa division, according to CNBC. The cuts happened in November as the company continued a “belt-tightening” strategy. It also cut an additional 180 positions in its gaming division to refocus on Prime Gaming and an undisclosed number in its Amazon Music division.
“As we continue to invent, we’re shifting some of our efforts to better align with our business priorities, and what we know matters most to customers — which includes maximizing our resources and efforts focused on generative AI,” Daniel Rausch, Amazon’s vice president of Alexa and Fire TV, wrote in a memo to employees, which was reported earlier by GeekWire. “These shifts are leading us to discontinue some initiatives, which is resulting in several hundred roles being eliminated.”
The cuts come to employees across the globe including employees in the US and Canada.
In March, 9,000 jobs as Amazon unveiled it would lay off 18,000 employees earlier this year. AWS was not impacted by the layoffs.
VMware Cuts Employees After Broadcom Acquisition
After San Jose, Calif-based semiconductor manufacturer Broadcom bought VMware in November, thousands of employees opened an email not knowing if they’d have a job by the end of the day.
The number of jobs cut was not disclosed.
From the time the deal was announced in 2022, Broadcom told Wall Street analysts that there would be “deep cuts” to VMware, with as much as $250 million in synergies being outlined, CRN reported in November.
In May 2022, Broadcom CEO Hock Tan discussed a plan to grow Palo Alto, Calif.-based VMware’s profitability by $3.8 billion by “eliminating duplicative general and administration functions across human resources, finance, legal, facilities and information technology,” according to documents filed with the SEC.
Splunk Cuts More Than 500
In November, San Francisco-based vendor Splunk laid off seven percent of its workforce, or about 537 employees, after it was acquired by Cisco for $28 billion. The cuts affected U.S.-based workers as well as some in the Americas.
Splunk did not disclose the total number of impacted employees but as of February it had 7,675, CRN previously reported. A prior round of layoffs affected 325 workers.
“The changes we are announcing are not a result of our agreement with Cisco,” Splunk CEO Gary Steele wrote in a memo to employees at the time, which was included in a filing with the U.S. Securities and Exchange Commission. “We expect the macro environment will continue to be unpredictable for the foreseeable future.”
He added that the cuts were “the continuation of the important initiatives we’ve undertaken across Splunk for more than a year to align our resources and operating structure.”
Twilio Lays Off 5 Percent
San Francisco-based software company Twilio laid off 300 employees, about five percent of its workforce, in the data and applications business, in early December.
It was the third round of layoffs since September 2022. Since then, it has laid off more than 3,000 employees, or about one-third of its total workforce.
“Last year, we made the decision to invest, ahead of growth, in go-to-market for Segment. Unfortunately, that bet hasn’t led to the growth outcome we’d hoped for. As a result, we’re simply spending too much,” said CEO Jeff Lawson said in a memo to employees that was documented in a regulatory filing. “The decision to eliminate these roles was a hard one, but we’re confident it’s in the best interest of our customers and the long-term health of our business.”
Qualcomm Cuts More Than 1,200 Employees
San Diego, Calif.-based Chipmaker Qualcomm laid off 1,258 employees in California in mid-December, according to CNN. The layoffs impacted about 2.5 percent of its 51,000-person workforce. Those impacted were based in San Diego and Santa Clara and included multiple roles such as engineers, legal counsel and human resources.
On an analyst call in August, Akash Palkhiwala, Qualcomm CFO, said that the company would be taking “proactive measures” to lower costs as it was facing decreased revenue, CNN reported.
“Given our commitment to operating discipline, we will proactively implement additional cost actions,” Palkhiwala said on the call. “Until we see sustained signs of improving fundamentals, our operating framework does not assume an immediate recovery.”
Intel Cuts 311 Workers
Just before the Christmas holiday break, Santa Clara, Calif.-based semiconductor manufacturer Intel cut just over 300 jobs amid a multibillion-dollar cost-cutting effort. Those impacted were based out of its two California offices, about 76 employees at its headquarters in Santa Clara and about 235 employees in Folsom.
Hundreds more within the company were laid off in August.
The layoffs were expected to start taking effect at the end of the year, according to an Intel memo, which is required by California’s Worker Adjustment and Retraining Notification (WARN) Act.
“Intel is working to accelerate its strategy while reducing costs through multiple initiatives, including some business and function-specific workforce reductions in areas across the company,” an Intel spokesperson told CRN in a statement. “These are difficult decisions, and we are committed to treating impacted employees with dignity and respect.”