California-based financial software giant Intuit recently announced plans to lay off 1,800 employees, approximately 10% of its workforce, and start hiring an equivalent number of new employees in the next fiscal year to drive its AI-centered restructuring plan.
According to the multinational company’s regulatory filing on July 10th, operating in 8 countries with 19 offices, this move is part of the tech giant’s initiative to “reallocating resources to key growth areas,” particularly integrating artificial intelligence (AI) into its products and services.
Intuit’s software products include QuickBooks, ProConnect, TurboTax, among others.
In an article posted on the company’s website on July 10th, Intuit’s CEO Sasan Goodarzi informed employees that offices in Boise, Idaho, and Edmonton, Canada, would be closing, with some employees being transferred to new locations.
Goodarzi stated that over 1,050 employees were being laid off for not meeting company expectations, and an additional 300 positions were eliminated to “streamline operations.” The company also plans to integrate around 80 technical positions into Atlanta, Bangalore, New York, Tel Aviv, and Toronto.
The company said that employees affected by the restructuring will leave the company on September 9th, giving them approximately 60 days to find new employment.
Intuit spokesperson Sara Day told SFGate that 599 California employees were impacted by the layoffs, including 384 at the Mountain View headquarters and 215 in San Diego.
In his blog post on the 10th, Goodarzi mentioned, “AI is igniting global innovation at an astonishing speed, transforming every industry and company in ways we couldn’t have imagined just a few years ago… Companies not prepared to harness this AI revolution will fall behind and ultimately cease to exist.”
However, Goodarzi mentioned that Intuit plans to rehire around 1,800 new employees by 2025 as part of its broader company restructuring plan and expects “overall employment to increase in the 2025 fiscal year and beyond.”
He stated, “The changes we are making today enable us to allocate additional investment to our most critical areas to support our customers and drive growth. This includes reinvestment in the technology and capabilities needed to support these areas.”
He mentioned that the primary focus of new hires will be in “engineering, product, and customer-facing roles, such as sales, customer relations, and marketing.”
According to regulatory filings, affected US employees will receive severance pay of at least 16 weeks, with additional yearly accumulated pay based on years of service. Furthermore, laid-off employees will also receive six months of health insurance coverage and other support. Intuit estimates a payout of $217 million to $227 million for severance costs and employee benefits.