Salesforce is It’s been in the news a lot lately, but not mainly for positive reasons. It’s been such a dramatic and tumultuous time for the cloud CRM leader that the first year of the year has been a little reassuring. The company announced last week that it would lay off 10% of its roughly 80,000 employees.
Layoff news is never good, but it comes on the heels of many other negative reports. Key executives, including co-CEO Brett Taylor announcing he’s leaving the company and Slack co-founder and CEO Stewart Butterfield stepping down soon after a two-year post-acquisition commitment expires there was an exit.
In addition, Salesforce announced in its latest earnings that, for the first time in history, it will not forecast earnings for the next fiscal year due to the uncertain economic environment.
Then there was the business of activist investor Starboard Value, which acquired a stake in October. One of the company’s demands is more operational discipline, perhaps layoffs are part of it, or at least a convenient excuse to cut staff.
If that wasn’t enough, after establishing itself as a digital headquarters through the pandemic (a big reason they bought Slack), the company’s chairman and CEO, Marc Benioff, said last month that new employees would be less productive so they could cut production. It sent a misleading signal of low sexuality. Not benefiting from office culture.
Perhaps Benioff was frustrated with spending so much money on fancy office space that very few employees actually use, and Salesforce has fewer employees spending less time in the office. Reduce office spending over time. As a 10% occupancy.
But why fire now? Perhaps it was time to hit the brakes amidst a mix of economic signals. We asked several industry analysts who follow Salesforce for their opinions.
