Salesforce to cut 10%

The software giant is the largest private-sector employer in its hometown of San Francisco. It has almost tripled its workforce in the past four years, in large part through dozens of acquisitions, including buying Slack in 2021 for $27.7 billion.

Salesforce Inc. announced it will cut about 10% of its workforce and reduce real estate holdings. The enterprise software company said it hired too many people during the pandemic-fueled boom and is adjusting to more cautious customer spending.

The workforce moves should be completed by the end of fiscal 2024, Salesforce said Jan. 4 in a regulatory filing. They cost the company $1.4 billion to $2.1 billion. As much as $1 billion of that will come in its fiscal fourth quarter. Salesforce had about 80,000 employees.

“The environment remains challenging, and our customers are taking a more measured approach to their purchasing decisions,” Salesforce CEO Marc Benioff said in a Jan. 4 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.”

Benioff said in the letter that many of the affected employees would be notified within the “next hour” and will receive a minimum of about five months of pay, health insurance, career resources, and other benefits. Those outside the US will receive a similar support aligned with local employment laws, the letter said.