Dropbox is the latest tech giant to slash its employee numbers, with the CEO signalling a pivot towards AI.
Dropbox will cut 500 jobs, roughly 16 per cent of its workforce.
CEO Drew Houston said in a letter to staff that while Dropbox is profitable, growth has been slowing.
“Part of this is due to the natural maturation of our existing businesses, but more recently, headwinds from the economic downturn have put pressure on our customers and, in turn, on our business, “Houston wrote.
“As a result, some investments that used to deliver positive returns are no longer sustainable.
“Second, and more consequentially, the AI era of computing has finally arrived. We’ve believed for many years that AI will give us new superpowers and completely transform knowledge work. And we’ve been building towards this future for a long time, as this year’s product pipeline will demonstrate.
“The opportunity in front of us is greater than ever, but so is our need to act with urgency to seize it. Over the last few months, AI has captured the world’s collective imagination, expanding the potential market for our next generation of AI-powered products more rapidly than any of us could have anticipated. However, this momentum has also alerted our competitors to many of the same opportunities.
“In an ideal world, we’d simply shift people from one team to another. And we’ve done that wherever possible. However, our next stage of growth requires a different mix of skill sets, particularly in AI and early-stage product development. We’ve been bringing in great talent in these areas over the last couple years and we’ll need even more.”
Houston said he takes “full ownership of this decision and the path that led us here.”
Dropbox shares fell by 2 per cent after the announcement.
