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Salesforce says it's cutting about 10% of its employees and closing some offices

Marc Benioff, founder, chairman and co-CEO of Salesforce, speaks at an Economic Club of Washington luncheon in Washington, DC, on October 18, 2019
Salesforce Co-CEO Marc Benioff.NICHOLAS KAMM/AFP via Getty Images
  • Salesforce said Wednesday it will lay off about 10% of its employees.

  • Co-CEO Marc Benioff attributed the layoffs to over-hiring during the pandemic.

  • The company also said it would close some offices as part of a restructuring plan.

Salesforce said Wednesday it will cut about 10% of its workforce "mostly over the coming weeks" and close some offices as part of a cost-cutting drive.

"The environment remains challenging and our customers are taking a more measured approach to their purchasing decisions," co-CEO Marc Benioff said in an email to staff. "With this in mind, we've made the very difficult decision to reduce our workforce by about 10 percent, mostly over the coming weeks."

He added: "As our revenue accelerated through the pandemic, we hired too many people leading into this economic downturn we're now facing, and I take responsibility for that."

The job cuts had been on the horizon for several weeks. Insider reported in December that some Salesforce managers were being asked to identify their bottom 10% of employees.

Affected employees were due to receive an email within an hour of the announcement, Benioff said. Laid-off staff in the US would get close to five months of pay, health insurance, and career resources, he added.

In a regulatory filing published Wednesday, Salesforce said it would make "select real estate exits and office space reductions within certain markets." These reductions, and the headcount cut, formed part of a restructuring plan  "intended to reduce operating costs, improve operating margins, and continue advancing the company's ongoing commitment to profitable growth," the filing says.

The company says in the filing that it expects to spend between $1 billion and $1.4 billion on employee transition, severance payments, employee benefits, and share-based compensation, and a further $450 million to $650 million on exit charges related to its office space reductions.

As of January 31, 2022, Salesforce had 73,541 employees, with 55% based in the US.

Read the original article on Business Insider