Why Freshworks is laying off 11% of its workforce as AI takes over the majority of coding work
Freshworks has become the latest vendor to join the AI-related job cutting roster, with plans to axe 11% of its workforce, despite a 16% year-on-year revenue rise to $228.6 million in its latest quarter.
The AI impact is coming largely from the engineering side of the business, with over half of coding work now delivered by AI. The lay-offs, totalling around 500 roles worldwide, will incur an $8 million restructuring charge, the majority of which hit will be taken in the current quarter.
There are a couple of reasons for making the restructuring decision now, argued CEO Dennis Woodside:
The first was we recently consolidated our go-to-market strategy. We had, I wouldn't say equal, but a more equal focus on inbound versus outbound. We're increasingly focusing on that EX (Employee Experience) business, which is primarily an outbound motion and focusing on acquiring CX (Customer Experience) customers with better unit economics....
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