Artificial IntelligenceCryptocurrencyMetaverseCybersecurityTech Forward

After blockbuster quarter, Salesforce lays off nearly 1,000 employees

August 26, 2020, 9:04 PM UTC

A day after Salesforce reported blockbuster financial results, the business software company is laying off nearly 1,000 workers.

Salesforce said Wednesday that it is “reallocating resources” in an effort to maintain its “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,“ a Salesforce spokesperson said.

The layoffs, which began yesterday, will affect employees worldwide, according to a person familiar with the matter. The person said the job cuts will be in nearly every business unit, and that they are part of a plan to help the company push into newer areas of business, including security, infrastructure, and the public sector.  

Salesforce has nearly 50,000 employees.

The layoffs come a day after Salesforce reported second-quarter sales of $5.15 billion, beating analyst estimates. The company also raised its revenue guidance for fiscal 2021, from $20 billion to between $20.7 billion and $20.8 billion, underscoring executives’ optimism that the company will maintain its growth.

The solid quarter, coupled with the layoffs, pleased investors. Salesforce shares jumped 26% to $272.32 on Wednesday.

In March, early in the coronavirus pandemic, Salesforce CEO Marc Benioff won accolades for saying the company would not do any “significant layoffs” over a three-month period and would pay its hourly workers while the company’s offices were closed. That period has since passed.

Other organizations that have disclosed layoffs amid the coronavirus pandemic include Microsoft’s LinkedIn unit, which said in July that it would lay off 960 employees, and American Airlines Group Inc., which said in May that it would eliminate 5,100 jobs.