Salesforce Inc. is set to reduce its workforce as it begins its new fiscal year, according to an individual familiar with the situation. This move occurs alongside the company’s efforts to recruit staff for selling its new Artificial Intelligence (AI) offerings.
The job cuts will impact over 1,000 positions, as indicated by the source, who requested anonymity due to the confidentiality of the information. Affected employees will have the opportunity to apply for other roles within the company.
A spokesperson for Salesforce, headquartered in San Francisco, declined to provide comments on the job cuts. It remains unclear which specific departments will see the reductions. As of January 2024, Salesforce employed nearly 73,000 people, at the conclusion of the previous fiscal year.
In the tech industry, companies have increasingly adapted to job reductions, particularly following a significant wave of layoffs in early 2023. Major firms such as Amazon.com Inc., Microsoft Corp., and Meta Platforms Inc. have also engaged in workforce reductions this year.
As a leading provider of customer management software, Salesforce is undergoing a hiring surge to bolster its sales team for new AI-driven products. However, the company is also under pressure to maintain its profit margins, especially after facing scrutiny from activist investors last year.
Chief Operating Officer Brian Millham addressed the balance between innovation and financial commitments during a December event hosted by Barclays Plc. He emphasized the importance of identifying efficiencies across the organization while making strategic investments for future growth. “Just because we have a hit new product doesn’t mean that we ignore the commitments we’ve made internally and externally as we think about scaling this business,” he said.
Salesforce is anticipated to announce its fourth-quarter earnings at the end of February.
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