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- Intuit's CEO wrote in an email to staff that 1,050 of 1,800 cut employees didn't meet expectations.
- The company plans to hire a roughly equal number of workers in roles in engineering and prudcut.
- The company is moving forward with a reorganization plan to focus on "key growth areas" like AI.
Intuit announced Wednesday that it's cutting 1,800 employees, 1,050 of whom weren't meeting expectations, according to an email from the CEO.
"We've significantly raised the bar on our expectations of employee performance," the CEO wrote in the email included in an SEC filing.
CEO Sasan Goodarzi added in the email that the company believes the staff would find more success elsewhere, the report said. Intuit did not respond to a request for comment.
The company is also reducing the number of executive employees by about 10% and will cut 300 employees to "streamline work and reallocate resources toward key growth areas," the email said. The tax-preparation software company, which offers products like Credit Karma and TurboTax, is moving forward with a "reorganization" plan to focus on these areas, according to the SEC filing.
The CEO noted in the email that the cuts aren't a cost-reduction measure. In fact, the company plans to hire a "nearly equivalent number of employees in fiscal 2025 " and expects its overall head count to grow, the filing stated.
"We do not do layoffs to cut costs, and that remains true in this case," Goodarzi said in the letter.
Some of the key areas include its AI-powered assistant Intuit Assist, according to the filing. The CEO also stated plans to make investments in data and AI, accelerate money solutions, and expand its international growth, the filing detailed. The company is consolidating 80 tech roles in sites with growing technology teams, like Tel Aviv, Toronto, and Bangalore.
The CEO said in the email that the "era of AI is one of the most significant technology shifts of our lifetime" and companies that don't take advantage of it will fall behind. Intuit plans to hire for roles in engineering and product, and customer-facing roles like sales and marketing, according to the filing.
Intuit isn't the only company shifting its staffing to make way for AI advancement. A number of tech companies have done the same, and CEOs at companies like Google, Microsoft, and Dropbox have cited AI in their reasoning for layoffs.
The cuts could cost the company up to $260 million, including severance, employee benefits, and charges related to share-based compensation and site closures. However, these estimates could vary, the company noted in the filing.
US employees who were cut will receive a minimum of 16 weeks of pay and two additional weeks for each year of employment. Employees will have 60 days before ending their time at Intuit, and international employees will receive similar support, with variations depending on local requirements.
"This timing allows everyone leaving to reach their July vesting date for restricted stock units and the July 31 eligibility date for annual IPI bonuses," Goodarzi said in the email.