Salesforce is cutting around 1,000 jobs despite the company's shares reaching all-time record high following a strong second-quarter earnings report.
Employees affected by the cuts will be given 60 days to find a new role within the company, according to CNBC sources, which could mean the firm lays off significantly less than 1,000 staff.
Salesforce is reportedly preparing to list 300 new positions next week as it shifts its business model due to the impact of COVID-19. In March, as the pandemic shut down large parts of the economy, CEO Marc Benioff pledged not to lay off employees for 90 days. That period came to an end sometime in June.
"We're reallocating resources to position the company for continued growth," a Salesforce spokesperson said. "This includes continuing to hire and redirecting some employees to fuel our strategic areas, and eliminating some positions that no longer map to our business priorities."
Employees that don't manage to land new positions will be offered severance and six months of pay benefits, the company said.
The cuts come just a day after the cloud giant reported a quarterly profit of $2.63 billion on revenue of $5.15 billion. Its revenue has grown 29% compared to the previous year and the firm expects total revenue of $20.7 billion in its current fiscal year, ending 31 Jan.
Shares in the company have also never been higher, with stock surpassing a 19% gain recorded in November 2008.
The impact of the coronavirus pandemic and the subsequent recession has forced a number of companies into mass redundancies and strategic shifts, such as permanent remote working or a greater focus on digital operations. Salesforce's financial officer Mark Hawkins said the company was making "strategic shifts" that reflected how and where people now work as a result of the pandemic.
"This means we'll be redirecting some of our resources to fuel growth and areas that are no longer as aligned with the business priority will be de-emphasised," he said.
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