Intuit is investing in the future by focusing on AI — but 10% of its staff won't be coming along for the ride.
The financial software maker is the latest in a long string of tech companies to announce layoffs, but CEO Sasan Goodarzi has made clear that the 1,800 staff being let go will be quickly replaced with the same number who will focus on critical areas, including AI.
Indeed, Goodarzi said Intuit's overall headcount would likely grow over the next year.
"We do not do layoffs to cut costs, and that remains true in this case," he wrote in a memo sent to staff entitled "investing in the future," which was shared on the Intuit blog.
"The changes we are making today enable us to allocate additional investments to our most critical areas," which he later detailed as including AI-powered projects including Intuit Assist, as well as international growth.
The move follows a host of companies in the industry facing job cuts recently, but Intuit also follows Dropbox's lead by specifically pinning the job losses on the need to focus on AI. Last year, Dropbox cut 16% of its workforce, some 500 jobs, as part of plans to refocus on AI product development.
Intuit isn't the first to pin job cuts on AI investment
When people express concern about AI-related job losses, these aren't the types of layoffs they mean: the worry is usually centered on AI and automation replacing people at work, rather than roles disappearing in order to build the technology.
There's no wonder the former is generally the focus. A 2023 study from Goldman Sachs suggested 18% of current roles could be lost to automation, equaling some 300 million full-time jobs globally.
But that's when the technology has matured – first, AI systems need to be built.
Goodarzi suggests the pain felt by the laid-off staff is worth it to protect Intuit's jobs in the long run.
"Companies that aren’t prepared to take advantage of this AI revolution will fall behind and, over time, will no longer exist," he said in the memo sent to staff.
"Intuit is in a position of strength; we have the strategy and momentum that we need to succeed. To fulfill our mission to power the prosperity of our customers around the world and strengthen our leadership position, we must accelerate our innovation and investments in the areas that are most important to our future success."
Last year, Dropbox CEO Drew Houston said in a podcast that the cuts were specifically to "make room for investments in AI".
Houston said out loud what others have suggested more quietly; that AI investment is costing jobs. Last year, Google slashed 1,000 jobs to fund its "ambitious goals", while Buzzfeed cut 15% of staff a month after revealing plans to use AI to write stories.
However, as Brookings Institute fellow Mark Muro told Business Insider last year: "The AI explosion may be a convenient explanation for ordinary mismanagement."
Intuit's big shift
Indeed, Goodarzi detailed the reasoning behind the job cuts, saying 300 roles were being cut to "reallocate resources toward key growth areas" — and that includes AI investment.
However, the company was also reorganizing by slashing executive roles by 10%, with another 80 technology roles consolidated to bolster teams in specific locations. Two sites in Edmonton and Boise were set to close, with the 250 impacted staff relocated or let go.
In fact, the bulk of the laid-off employees were let go for another reason: "We’ve significantly raised the bar on our expectations of employee performance, resulting in approximately 1,050 employees leaving the company who are not meeting expectations and who we believe will be more successful outside of Intuit."
Goodarzi added that the new hires would primarily be in engineering and product development, as well as sales, customer service, and marketing.
