The restructuring plan might cost Salesforce $2 billion in 2023
Salesforce announced that it would lay off approximately 10% of its workforce
In a tough economic climate, Salesforce CEO Marc Benioff said the company will lay off an undisclosed number of employees. Benioff stated that those affected in the United States will receive at least five months of pay, health insurance, and other benefits to assist with their transition.
In a letter to employees and a filing with the Securities and Exchange Commission (SEC), CEO Marc Benioff cited the difficult business environment and the more cautious approach that customers are taking with their purchasing decisions. Benioff also acknowledged that the company had hired too many employees during the pandemic when business was thriving, bringing its total number of employees up to 79,000, a 30% increase.
A similar level of support will be offered to employees outside the US. Just a few months before, activist investor Starboard Value acquired a stake in Salesforce and speculated that cost-cutting measures would be implemented. In November, the company already announced layoffs affecting hundreds of workers, and co-CEO Bret Taylor announced his departure.
Salesforce, like many other tech companies, has been struggling amid economic challenges. The company’s market value reached a record high of over $300 billion in late 2021, but has since corrected to around $134 billion.
The restructuring plan that the company announced will come with a price tag of $1.4 billion to $2.1 billion.
