LinkedIn on Wednesday joined what’s become a near-daily drumbeat of layoff announcements among tech companies.
The Microsoft-owned company will reportedly eliminate about 5% of its headcount, which might total roughly 875 employees based on the latest headcount estimate. The cuts are part of a broader reorganization, as LinkedIn CEO Daniel Shapero detailed in an internal memo to staff.
As has been true among several other tech companies recently, Shapero didn’t specifically mention AI as a reason for the layoffs in his missive sent at 7 a.m. Pacific. Rather, he emphasized a shifting landscape, according to the text of his memo obtained by Business Insider.
“For us to meet this moment, we must ready ourselves to deliver a step change in impact across our products, businesses, and platforms, while continuing to operate more profitably. We need to reinvent how we work, with agile teams focused on our highest priorities, and by shifting investments toward areas such as infrastructure to fulfill our mission and vision over the long term,” Shapero wrote, in part. “This requires hard prioritization and tradeoffs.”
In addition to cuts across five different divisions, Shapero said that the company will scale back investments in areas like marketing campaigns, vendor spend, customer events, and underutilized office space. The professional social network is based in Sunnyvale, California.
The company confirmed the layoffs to Fast Company, though disputed the percentage of employees impacted by the cuts without clarifying the actual number. “As part of our regular business planning, we’ve implemented organizational changes to best position ourselves for future success,” a company spokesperson told Fast Company.
EARNINGS, BUYOUTS
It’s perhaps ironic that the platform where users might log in to see news of yet another spate of layoffs is now the one doing the layoffs. What’s more, Microsoft reported better-than-expected quarterly results last month, including that LinkedIn had seen a 12% jump in revenue compared with the prior year.
Even so, Microsoft also announced its first-ever move to reduce its headcount via buyouts last month amid the shift to AI and has done other rounds of layoffs in recent years. The tech giant acquired LinkedIn in 2016.
Despite news of the layoffs, shares of Microsoft fell about 0.6% as of late trading on Wednesday, while the S&P 500 was poised to hit a new record high.