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Big Tech Faces More Layoffs As Bloated Sector Struggles

Big tech companies Meta, Atlassian, Sirius XM, and Microsoft are laying off substantial segments of their workforce in March.
by Jason Cohen, TFP File Photo

In March, big tech companies Meta, Atlassian, Sirius XM, and Microsoft are laying off substantial segments of their workforce.

With the tech industry’s slump following excessive hiring practices during the pandemic, companies are striving to make corrections through layoffs, according to CNN. The companies have cited multiple factors for the change but mainly attribute the cuts to boosting efficiency, rebalancing, and finances.

After laying off 11,000 employees in November 2022 in its first-ever major layoff, Meta–the parent company of Facebook and Instagram–reportedly plans to lay off thousands more.

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According to Bloomberg, this upcoming stage of layoffs may be finalized in the next week due to the desire to complete it before Mark Zuckerberg, their chief executive officer, goes on parental leave for his third child.

Zuckerberg has dubbed 2023 “the year of efficiency” for Meta, so this second round of layoffs did not shock its workers, according to Bloomberg. However, many are experiencing anxiety and low morale, including concern regarding receiving bonuses scheduled to be distributed this month if they are let go.

Microsoft laid off another 689 workers in the Seattle area, bringing the number of total workers laid off in the Seattle area to 2,200.

Microsoft CEO Satya Nadella stated in January that the company needs to lay off 10,000 workers globally to “align our cost structure with our revenue and where we see customer demand,” according to The Seattle Times.

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Atlassian, the software company behind Jira, Trello, and Confluence, also announced they are laying off about 5% of their workforce, approximately 500 workers. Their co-founders and co-CEOs, Mike Cannon-Brookes and Scott Farquhar stated in their announcement that it is not related to poor financial performance, although the company did report net losses along with its increased revenue.

Atlassian’s net loss was “$205.0 million for the second quarter of fiscal year 2023, compared with a net loss of $22.3 million for the second quarter of fiscal year 2022,” according to their announcement of second quarter fiscal year 2023 results.

Instead, they framed it as “rebalancing” by refocusing their priorities rather than making broad cuts, writing, “We’ve made hard calls to reduce our investment in specific areas in order to reinvest in others.”

Sirius XM announced its plans to lay off about 8% of its workforce, or about 475 employees. The company reported a subscriber gain of 134,000 in the most recent quarter, but its subsidiary Pandora has been declining, according to TechCrunch.

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In an email sent to employees by CEO Jennifer Witz, she stated that they had finished an assessment and now have figured out “where we can consolidate teams to achieve greater efficiencies” and that the updated structure “will allow us to move faster and more effectively as we take on new challenges across our business,” according to TechCrunch.

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