While the economy teeters on the edge of a recession, companies across industries are laying off excess employees, many of whom were hired during the early stages of the pandemic. Salesforce, which intends to cut its workforce by 10%, is also carrying the weight of its pandemic-driven acquisitions — especially the near $28 billion purchase of business communication app Slack. At the time, some experts and insiders questioned the price Salesforce paid for the platform. Marc Benioff, the grandstanding CEO, takes full credit for the over-hiring, but employees of both companies are feeling the burn.
Salesforce and its leader hit a rough patch in 2022. In November, co-CEO Bret Taylor stepped down amid reports of tension between the two; Slack founder and CEO Stewart Butterfield announced his resignation shortly thereafter. Another driver of the cost-cutting measures is the CRM giant’s seemingly stagnated growth, after more than two decades of success. Also, the company has yet to see much return on some of its other acquisitions, including Tableau and MuleSoft, for which it paid a combined $22 billion.
Now, layoffs are affecting both Salesforce and its newest additions, making the high prices paid even more questionable. Benioff’s company may find it needs to cut more than just its workforce — possibly Slack or its other subsidiaries.