CNN
Google parent Alphabet is eliminating about 12,000 jobs, or 6% of its workforce, the company said Friday, in the latest cuts to shake the technology sector.
The cuts will affect roles across product areas and regions, CEO Sundar Pichai said in an email to employees that was posted on the company’s website Friday.
Affected US employees will remain on the company’s payroll for 60 days and receive at least 16-weeks salary in severance, in addition to other benefits.
Alphabet grew its workforce by more than 50,000 employees over the past two years as booming demand for its services during the pandemic boosted profits. But in recent quarters, the company’s core digital ad business has slowed as the economic downturn and recession fears caused advertisers to pull back their spending.
“Over the past two years we’ve seen periods of dramatic growth,” Pichai said in the email. “To match and fuel that growth, we hired for a different economic reality than the one we face today.”
Pichai said the layoffs were part of an effort to refocus on the company’s core business, as well as its early investments in artificial intelligence. “These are important moments to sharpen our focus, reengineer our cost base, and direct our talent and capital to our highest priorities,” he said.
Alphabet is set to report earnings for the three months through December 30 in early February, and Wall Street analysts are expecting the company’s revenue to grow just 1.7% compared to the same period in the prior year. That would mark a sharp slowdown from the 32% growth it posted at the same time last year. Analysts are also projecting net income will be down nearly 25% year-over-year.
Google’s job cuts are just the latest in a bruising wave of tech layoffs, as inflation weighs on consumer spending and rising interest rates squeeze funding. The demand for digital services during the pandemic has also waned as people return to their offline lives.
Microsoft (MSFT) said on Wednesday it would cut 10,000 employees. Amazon (AMZN) also recently announced that it would lay off 18,000 people, Salesforce (CRM) is cutting 10% of its staff and Facebook (FB)-parent Meta has announced 11,000 job cuts…
