CONNECT WITH US
Tech

Tech

HubSpot layoffs: CEO says job cuts are not driven by AI ‘efficiencies,’ but AI is still behind the sweeping changes

Fast Company logo

Published on

Add as a preferred source on Google
HubSpot layoffs: CEO says job cuts are not driven by AI ‘efficiencies,’ but AI is still behind the sweeping changes

HubSpot announced on Tuesday that it is cutting 7% of its workforce—roughly 660 employees—as it reorganizes around what it calls AI-driven customer outcomes. 

The layoffs come as investors have spent months questioning whether AI will reduce the need for businesses to pay for software like HubSpot’s, a fear dubbed the “SaaSpocalypse.” 

HubSpot’s platform helps companies manage their customers, sales, and marketing. The company was removed from the FTSE All-World Index (USD) last month after a decline in its stock price, a report from Simply Wall St noted. The stock is down more than 43% this year as of this writing.

After news of the layoffs was announced Tuesday, premarket shares of HubSpot Inc. (NYSE: HUBS) rose over 1%, but they were down again by 1.57% as of midday trading. 

Yamini Rangan, CEO of HubSpot, explicitly told employees in a memo that the layoffs were “not driven by AI-related efficiencies.” Rather, the aim was to focus on “aligning our organization with our strategy and how we need to operate going forward,” Rangan wrote. 

She added that the goal is to “build a flatter organization with fewer layers” by cutting back on management. 

Still, artificial intelligence has been central to the company’s concerns. In August, Rangan blamed AI for why the company “got off to a slow start” in April as HubSpot was trying to adjust its product and pricing.

“We’re in the middle of a real transition to AI, and we are making deliberate choices to lead in it,” she said on an earnings call.


Source link
Related Topics:Tech

Disclaimer

We strive to uphold the highest ethical standards in all of our reporting and coverage. We TheMorningPulse.fyi want to be transparent with our readers about any potential conflicts of interest that may arise in our work. It's possible that some of the investors we feature may have connections to other businesses, including competitors or companies we write about. However, we want to assure our readers that this will not have any impact on the integrity or impartiality of our reporting. We are committed to delivering accurate, unbiased news and information to our audience, and we will continue to uphold our ethics and principles in all of our work. Thank you for your trust and support.