Dropbox to lay off 16% of its global workforce, hire new talent to develop AI offerings
Cloud storage provider Dropbox becomes the latest tech company to let go of its employees. The San Francisco, California-based Dropbox announced today its plans to reduce its global workforce by 16% as part of the cut-cutting measures caused by slowing cloud growth. The cut will impact about 500 of the 3,118 full-time employees.
The news comes two years after the company laid off 11% of its global workforce, which affected 315 people. In addition to the layoff, the company also let go of its Chief Operating Officer Olivia Nottebohm a month later.
However, the company also revealed its intentions to hire new talent to develop its AI offerings, Reuters reported. Similar to other major players in the technology industry such as Microsoft and Meta Platforms (formerly known as Facebook), Dropbox is now competing for a portion of the rapidly expanding market by introducing new products and services.
DropBox CEO Drew Houston said in a statement that the company’s primary cloud business growth is slowing due to the economic downturn posing challenges for customers. As a result, some of the company’s profitable investments are no longer sustainable.
“We’ve been bringing in great talent in these areas over the last couple years and we’ll need even more,” Houston said in a memo to staff. “The AI era of computing has finally arrived … The opportunity in front of us is greater than ever, but so is our need to act with urgency to seize it.”
As of the end of 2022, Dropbox had 3,118 full-time employees, with 2,583 located in the United States. The company reported that it had repositioned some employees from one team to another to concentrate on AI projects, but it required more expertise with a different mix of skill sets, particularly in AI and early-stage product development.
Founded in 2007 by Arash Ferdowsi and Drew Houston, Dropbox simplifies the way people work together. 500 million registered users around the world use Dropbox to work the way they want, on any device, wherever they go. With 150,000 businesses on Dropbox Business, we’re transforming everyday workflows and entire industries. Dropbox received initial funding from seed accelerator Y Combinator.
Correction: The title of this piece incorrectly stated the layoff was 11% instead of 16%. The story has been updated to reflect the actual percentage.