Categories: TechWorld

Salesforce cuts 10% of its workforce: ‘We hired too many people’

Salesforce CEO Marc Benioff is putting to rest right out of the gate in 2023 that he’s serious about improving profit margins, which Wall Street has pushed his leadership team to do in recent years.

On Wednesday, Salesforce said it would slash 10% of its workforce and execute select real estate exits and office space reductions. The company declined to comment to Yahoo Finance on what real estate it would be exiting or offices it would be reducing.

Advertisement

In any case, the company now joins the likes of Meta, Snap, and other tech giants by uncorking a major cost-cutting initiative amid a more muted demand backdrop.

“I’ve been thinking a lot about how we came to this moment,” Benioff said in a letter to employees. “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.”

Advertisement
Marc R. Benioff, Chairman and Chief Executive Officer of Salesforce, Member of the Board of Trustees of World Economic Forum, reacts as he attends the World Economic Forum (WEF) annual meeting in Davos, Switzerland, January 23, 2018. REUTERS/Denis Balibouse

The company estimates it will incur $1.4 billion to $2.1 billion in charges related with the actions.

Salesforce shares — which fell about 44% in 2022 — rose 3.4% in afternoon trading on the news.

The moves come as Salesforce is getting pushed by Wall Street to bolster margins following a string of high-profile deals such as Slack, Tableau, and Mulesoft.

Advertisement

Benioff has previously pushed back on the view that Salesforce isn’t listening to investor concerns.

“For us, I think that the market doesn’t fully appreciate how committed we are to growth and margins,” Benioff told Yahoo Finance Live at the software giant’s Dreamforce conference in San Francisco in late September.

Advertisement

Salesforce has committed to a 25% operating margin by calendar year 2025. If hit, it would mark a notable increase from 2022’s goal of 20.4%.

Advertisement
citynews

Recent Posts

Why Seyi Tinubu Can’t Be Lagos Governor- Igbokwe

A member of the All Progressives Congress (APC), Joe Igbokwe, has said Seyi Tinubu, son…

11 hours ago

Simon Ekpa Not Our Member, Should Not Be Associated With Us- IPOB

IPOB PRESS RELEASE 22/11/2024 SIMON EKPA IS NOT AN IPOB MEMBER AND MUST NOT BE…

14 hours ago

NEWSPAPER HEADLINES FOR FRIDAY 22ND NOVEMBER 2024

NEWSPAPER HEADLINES FOR FRIDAY 22ND NOVEMBER 2024. *PUNCH* Gombe begins N28bn Assembly, high court complexes…

15 hours ago

My husband assaulted me, ruined my career – Olajumoke Onibread

Former bread seller turned model, Olajumoke Orisaguna, popularly known as Olajumoke Onibread, has opened up…

17 hours ago

“I did not punch Akpabio” – Senator Bamidele speaks on alleged fight with Senate President

Senate Majority Leader, Opeyemi Bamidele has denies reports that he was involved in a fight…

18 hours ago

Speaker Obasa Clarifies Negative Perceptions As Sanwo-Olu Presents 2025 Budget

– says lawmakers united to meet yearnings of Lagosians – accuses detractors of peddling news…

18 hours ago