Salesforce Layoffs Total 1000 Employees After Strong Quarter

Uber, Lyft, Airbnb, Magic Leap, and other firms all initiated deep layoffs; big firms such as IBM also made significant cuts. In some cases, these layoffs …

Salesforce plans on laying off roughly 1,000 employees.

That news comes on the heels of a blockbuster quarter, with Salesforce reporting that it earned revenue of $5.15 billion (up from $4 billion in the year-ago quarter) and net income of $2.63 billion. Immediately after the results were announced, Salesforce’s stock price jumped 26 percent.

Salesforce framed the layoffs as a repositioning of its workforce, accompanied by hiring in new areas. “We’re reallocating resources to position the company for continued growth. This includes continuing to hire and redirecting some employees to fuel our strategic areas, and eliminating some positions that no longer map to our business priorities. For affected employees, we are helping them find the next step in their careers, whether within our company or a new opportunity,” a spokesperson wrote in a statement.

As noted by Fortune and other outlets, the layoffs come at a particularly auspicious moment. Earlier this year, Salesforce co-CEO Marc Benioff pledged that his company wouldn’t engage in any “significant layoffs” for three months:

Salesforce is pledging to its workforce Ohana not to conduct any significant lay offs over the next 90 days. We will continue to pay our hourly workers while our offices are closed. We encourage our Ohana to pay their own personal hourly workers like housekeepers & dog walkers.

— Marc Benioff (@Benioff) March 25, 2020

(“Ohana” means “extended family,” possibly including friends and neighbors, in Hawaiian.)

But that was in March, and we’re outside that three-month limit. Right after the layoffs announcement, Benioff defended the decision in an interview with Yahoo Finance: “It’s part of running our business in a successful way. And that does impact employees at different moments.”

He also insisted that Salesforce was serious about re-skilling, placement services, and other means of cushioning the blow for those impacted: “We’re still running a business, and we’re going to have to continue to make investment choices… But we will do it in the best way, a more compassionate way, a more sustainable way, a more equitable way, and more just way.”

Salesforce currently has around 50,000 employees. Like other tech firms during the COVID-19 pandemic, it has seen an uptick in business as companies add on cloud platforms and tools for their widely distributed workforces.

As the COVID-19 pandemic ripped across the world, it forced tech companies everywhere to readjust. Uber, Lyft, Airbnb, Magic Leap, and other firms all initiated deep layoffs; big firms such as IBM also made significant cuts. In some cases, these layoffs were directly attributed to the pandemic (especially in the case of tech firms with a substantial face-to-face customer service element, such as ridesharing giants Uber and Lyft); in others, executives have used more generic terms like “restructuring” or “readjusting” without mentioning the pandemic. Salesforce, in coming off a particularly strong quarter, is presenting a different twist on this narrative.