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8x8 To Lay Off 7 Percent Of Staff, Impacting Channel Leadership

Gina Narcisi

‘8x8 is losing their channel religion a little bit,’ one anonymous 8x8 partner tells CRN regarding the latest round of layoffs that reportedly include most of the cloud communication provider’s channel team.

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Cloud communications provider 8x8 on Wednesday announced a workforce reduction that will impact about seven percent of its staff globally. The layoffs have already begun and are impacting 8x8’s channel leadership team.

The company said in an 8-K filing that the job cuts are part of a restructuring plan to refocus its target market and to cut costs. 8x8 has 2,216 employees and the cuts will affect about 155 employees.

Campbell, California-based 8x8 did not comment on its staff reduction or impact to its channel team prior to publication and pointed CRN to its 8-K filed on Wednesday.

[Related: Tech Layoffs In 2022: 23 Companies Slashing Their Workforce]

An 8x8 partner who spoke under the condition of anonymity told CRN that the company has let go most of its channel team.

“8x8 is losing their channel religion a little bit,” the partner said.

The partner said the layoffs may be coming as the company prepares itself for acquisition. Reports surfaced last year that cloud communications competitor RingCentral was evaluating a deal to buy 8x8. RingCentral, for its part, in November revealed that it was cutting its workforce by 10 percent in light of what the company called “an increasingly difficult macro environment.”

8x8 is not alone. Many UCaaS providers have been conducting layoffs recently, having “got ahead of their skis” and in some cases, hiring too many during the pandemic, the partner said. “The problem in the communications space is that many of these companies focus on topline growth and now it’s time to pay the piper,” the partner said. “But they’re letting go some really talented people that know channel.”

8x8 said the job cuts are expected to be “substantially completed” by the end of its 2024 fiscal first quarter, which ends June 30. The company’s interim CEO, Sam Wilson, said in a letter to employees that conversations with those being laid off have already begun and that the cuts will impact teams and regions differently.

“Our success depends heavily on the ability to make difficult choices about where to deploy resources in order to create the greatest value. I wish it were never so, but sometimes that includes letting go of people, despite their excellent work, as priorities shift. Regrettably, that is the situation we currently face at 8x8 in order to align with emerging marketplace opportunities,” Wilson said in the letter.

Included in the layoffs was 8x8’s Vice President of North American Channels, Michael Cibelli, according to a post on the channel veteran’s LinkedIn on Thursday. Cibelli has been at the company for more than three years.

8x8 is the latest Bay Area company to cut jobs. Networking giant Cisco announced 700 impending job cuts in its San Jose, Milpitas and San Francisco offices earlier this month. Salesforce in January announced it would be laying off around 7,000 employees over the next few weeks due to hiring too many employees during the COVID-19 pandemic. Big data management tech company Informatica also this month revealed it would be cutting its staff by about 450 employees or about 7 percent of its workforce.

 

 

Gina Narcisi

Gina Narcisi is a senior editor covering the networking and telecom markets for CRN.com. Prior to joining CRN, she covered the networking, unified communications and cloud space for TechTarget. She can be reached at gnarcisi@thechannelcompany.com.

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