Cloud software developer Salesforce is poised to terminate nearly 2,500 employees to maintain operability amid the ongoing economic crisis.
The layoffs have been scheduled to be done before the US Thanksgiving holiday on November 24th, with around 1,000 already given the ax as of Monday, November 14th. Likewise, the announcement came less than a month after the company reduced the number of recruiting contractors working for it. Hiring at Salesforce has remained frozen since October.
According to a formal statement issued by the company, its sales performance process is what drives its accountability. But this has led to a number leaving Salesforce, though management hopes to support them throughout the impending transition.
However, no additional information has been given by the company as to the primary reasons for the layoff apart from its somewhat dismal showing in its most recent earnings report.
Before the announcement, Salesforce’s employee count stood at around 70,000 employees.
Likewise, Salesforce decreased its guidance for its projected revenues for the current fiscal year, which is set to end on January 31, 2023. It was the second time the company adjusted its guidance for this year. As of press time, Salesforce has yet to release its Q3-2022 earnings report.
What’s Behind the Layoffs?
Aside from the ongoing economic crisis, the cloud computing company noted a significantly lower demand for its collaborative/corporate product lines MuleSoft, Slack, and Tableau.
Tableau, in particular, was in the news last month, as its channel chief Julie Bennani resigned following the merger of partner programs under Salesforce, Tableau, and MuleSoft.
Cloud Vendors in Trouble
Salesforce isn’t the only company in the cloud sector that’s going through operational woes. Oracle recently laid off several hundred employees.
Other major industry players, specifically Amazon Web Services, Google Cloud, and Microsoft, also reported dismal performance in their respective earnings reports for the third quarter.
But, excuse the pun, there is a silver lining for this particular cloud. Several cloud enterprises and tech companies have been maximizing their use of LinkedIn to use the ongoing layoff boom for their own advantage, augmenting their own workforces with technical personnel from other firms.
These include an employee recruitment service affiliated with IBM, gaming / FinTech company Everi, customer experience solutions vendor Braze, and residential solar power solutions provider Sunnova.