LinkedIn, owned by Microsoft, revealed on Monday a workforce reduction of nearly 700 employees, primarily from their engineering department, as per a memo seen by CNBC. Sources also mentioned cuts within the finance and human resources departments, though the informant wished to remain anonymous due to unauthorized disclosure.
This decision follows a trend of slowed revenue growth for LinkedIn over eight consecutive quarters, reaching only a 5% increase in the recent quarter. Interestingly, membership growth has seen a rise for the last eight quarters, as reported by Microsoft in July.
In a memo penned by LinkedIn executives Mohak Shroff and Tomer Cohen, they emphasized the company’s direction. “To achieve our business objectives as outlined in our FY24 plan, we must refine our work approach and focus. This involves reshaping our organizational hierarchy to enhance adaptability and responsibility, clarifying roles, and optimizing processes.”
Earlier in January, Microsoft had announced a cutback of 10,000 employees, with further reductions in July. These actions align with the observed dip in Microsoft’s revenue growth, prompting CEO Satya Nadella to implement company-wide cost-saving measures. The recent layoffs at LinkedIn are over and above the January cuts, confirmed a spokesperson.
Interestingly, LinkedIn is bolstering its hiring efforts in India, as per an insider.
In a public blog post, LinkedIn shared, “While we reshape and simplify our internal processes, our commitment to our strategic future remains strong. Our primary objective is to consistently deliver value to our members and clientele.”
The company concluded by ensuring comprehensive support to the affected employees, emphasizing their commitment to their well-being and dignity.
Here’s the full memo:
Team,
We did not expect to share this important update with you all in the midst of such challenging times, but in the spirit of creating clarity, Tomer and I wanted to share some news regarding changes we are making to our orgs.
As we continue to execute on our FY24 plan, we need to also evolve how we work and what we prioritize so we can deliver on the key initiatives we’ve identified that will have an outsized impact in achieving our business goals. This means adapting our organizational structures to improve agility and accountability, establishing unambiguous ownership, and driving improved efficiency & transparency through reduced layering.
These decisions result in the reduction of 563 roles across R&D. Broken down there are 137 Engineering management roles and 38 Product roles being reduced. Additionally, there will be 388 role reductions across our Engineering team in an effort to better align resources to our FY24 plan, and we will open a small number of new roles to fill critical gaps in our ambitious roadmap.
For those who are directly affected by these changes, you will receive a calendar invitation within the next hour, titled “Required Attendance: R&D Role Reductions”. This meeting will provide you with detailed information on how we will support you through this transition.
If you do not receive this invitation, expect communication from your Product or Engineering Executive leader soon with specifics pertaining to your organization and how we will collectively navigate through these changes.
Tomer and I made these decisions with deep consideration towards the long-term needs of our business and with the acknowledgement that every affected individual has played a valuable role in the growth and success of Linkedin.
In the coming days, our focus will be on supporting each other and discussing the ways we will move forward, with our vision, mission, and values as our guides. Today, it is imperative that we support our colleagues navigating this transition. Let’s continue to embrace empathy and understanding through these difficult times and use these as a cornerstone for the support we provide each other.
Mohak & Tomer