- Intuit announces 1,800 job cuts – about 10% of the company’s total headcount, selecting 1,050 employees who don’t meet expectations.
- Intuit stock fell 2.57% to close at $632.84 in early trading Wednesday, up 1.25% year-to-date, compared with a 23.3% gain on the Nasdaq Commodities (Nasdaq COMP).
OUR TAKE
Intuit’s impressive transformation to AI not only demonstrates how a traditional company can adapt to changes in emerging technologies and continue to innovate and grow, but highlights the importance of data in the age of AI. While AI brings new challenges, it also presents tremendous opportunities for companies and society. As a company with a decades-long history, Intuit is showing us that innovation and change are still the keys to success, even in an era of technological advancement.
–Elodie Qian, BTW reporter
What happened
The Wall Street Journal reports that US tax software company Intuit announced on Wednesday that it plans to lay off about 1,800 employees – about 10% of the company’s total headcount, and close its sites in Boise, Idaho, and Edmonton, Canada.
In a letter to employees, Intuit CEO Sasan Goodarzi mentioned that the layoffs are not about cost-cutting, but about reallocating resources to key areas in the future, including AI. Intuit expects to hire 1,800 people in fiscal year 2025 to support growth goals, with the new positions focusing on engineering, product, and marketing jobs.
Bloomberg reported that Goodarzi mentioned in his letter that the thousands of employees who are let go are” not meeting expectations”. The company will also cut 10% of its senior executives to improve the speed of decision-making.
Intuit stock fell 2.57% to close at $632.84 in early trading Wednesday, up 1.25% year-to-date, compared with a 23.3% gain on the Nasdaq Commodities (Nasdaq COMP).
Also read: Intuit raises annual estimates on demand for AI-driven products
Also read: The profound benefits of digital transformation
Why it’s important
“At every major turning point, evolution must occur.” Intuit, a financial software vendor for more than four decades, has also reached its own turning point: its transformation into a software company powered entirely by AI.
Goodarzi, embarks on a massive strategic overhaul, and determines to put AI at the centre of business development. The overhaul includes two major acquisitions totalling $20 billion, the firing of employees, and heavy bets on AI technology.
A decisive factor in Goodarzi’s commitment to AI is the incredible trove of data that Intuit has at its disposal, which is the training material for AI models that help Intuit provide detailed and accurate financial advice to each of its customers.
“We did start to reorient our operations around data and AI, but it became clear to me that there wasn’t enough talent in the company capable of fuelling the pace of growth. So we reinvested money into much needed expertise,” Goodarzi said.
Goodarzi believes that AI will become as transformative a passive technology in the future as electricity and the internet. “We are at the beginning of the journey with AI,” he says. “In the next five to 10 years it will create new economies and destroy some economies, will create new experiences, fuel new company growth, and make certain companies go out of business.”
