Intuit to Lay Off 1,800 Employees

By Sarah Bregel, Fast Company (TNS)

Global financial company Intuit, which owns TurboTax, QuickBooks, MailChimp, and more, announced Wednesday that it’s laying off 1,800 employees, or about 10% of its workforce. Unlike many recent tech layoffs focused on reducing the workforce, Intuit cited that most of today’s layoffs were performance-related.

On Wednesday, the company, which has invested heavily in generative AI-powered tools in recent years, shared a note explaining the cuts. “We do not do layoffs to cut costs, and that remains true in this case,” A spokesperson for Intuit told Fast Company, that the brand “will continue to invest in ongoing training and development programs” but the shift is “about reinvesting in the necessary strategic functional capabilities and skill sets to support Intuit’s transformation.”

About 1,050 employees who “are not meeting expectations” are departing the company. CEO Sasan Goodzari said that the company has “significantly raised the bar on our expectations of employee performance” and that underperforming employees will be “more successful outside of Intuit.”

When asked, the company declined to comment on when those expectations were raised, or how long employees were given to improve performance before the layoffs.

Still, it seems that putting capital toward other areas of the company is a crucial part of the move. The company drove home how it will expand its generative AI efforts, which it has been an early adopter of, and accelerate its international growth. 300 roles will be eliminated entirely in an effort to “streamline work.”

Eliminating a large chunk of underperforming employees seems like a pivot to allow the company a reset. Goodarzi shared that the company plans to hire 1,800 individuals to work in marketing, engineering, and customer-facing roles and that in doing so, the company is expected to grow. “In context of the actions we are taking today, we expect our overall headcount to grow in FY25 and beyond,” the note said, explaining that the company expects to close sites in Edmonton, Canada and Boise, Idaho.

Earlier this year, Intuit reported a rise in third-quarter revenue. It also increased its annual forecast, as it expected more significant demand for its AI-generated products.

Last year, Intuit rolled out Intuit Assist, an AI tool that greets business owners with daily personalized briefings, answers questions, drafts emails, and more. It was certainly not the first company to use such tools, but given that its products were already being used by so many for accounting, payroll, and more, the AI tools had the advantage of using pre-stored information rather than having to input it.

U.S. employees will have their last day on September 9, 2024. The company note laid out details about severance packages and support, sharing that employees “will receive a package that includes a minimum of 16 weeks of pay, plus two additional weeks for every year of service.” It also explained that laid-off employees would have six months of health care and access to career transition and job placement services.

“With the strength of our people, culture, and mission, we are positioned to take advantage of this AI revolution and revolutionize our customers’ experiences to deliver undisputed benefits in ways that we could never imagine. Today is ‘Day 1. Together, we will focus on the future and all the possibilities to power prosperity around the world,” the note concluded.

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