Announcing the layoffs in a SEC filing, Freshworks also said that its board of directors approved a $400 million share buyback programme of its outstanding Class A common stock. In his post, Zoho CEO mentioned the $400 million buyback in stock, implying that the company he is talking about is Freshworks.
Here’s what Zoho CEO wrote on X
A company that has $1 billion cash, which is about 1.5 times its annual revenue, and is actually still growing at a decent 20% rate and making a cash profit, laying off 12-13% of its workforce should not expect any loyalty from its employees ever. And to add insult to injury, when it can afford $400 million in a stock buy back.
I can understand the unfortunate reality of layoffs when a business is struggling or declining and making a loss. This is not that situation, this is naked greed, nothing less.
Here is a critical question to its leadership: don’t you have the vision and imagination to invest $400 million in another line of business where you can deploy those people you hired but you don’t want anymore? Are there no such opportunities in tech? Are you so lacking in curiosity, vision and imagination? Are you so lacking in empathy?
This behavior, sadly, has become all too common in the US corporate world and we are importing it in India. It has only resulted in large scale employee cynicism in the US and we are importing that too.
This is why choose to remain private. We put our customers and employees first. Shareholders should come last.
What Freshworks CEO said about job cuts
Freshworks employees over 5,000 people. In the SEC filings letter, Fresh works CEO Dennis Woodside wrote “In November 2024, the Company committed to a restructuring plan (the Plan) to better align the Company’s talent with its strategic priorities and to improve operating efficiency. The Company estimates that this will result in approximately 13% reduction in headcount and approximately $11 million to $13 million in charges in the fourth quarter of 2024, consisting primarily of cash expenditures for separation-related payments, employee benefits and related costs. The Company expects that the Plan will be substantially complete by the end of the fiscal year ending December 31, 2024.”
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