Day of the accountant as intuit lays off 1800 because of ai

https://fortune.com/2024/07/10/intuit-layoffs-email-hiring-ai-transformation/

FINANCE·BUSINESS STRATEGY

Exclusive: Intuit is laying off 1,800 employees as AI leads to a strategic shift

BYSHERYL ESTRADA

July 10, 2024 at 8:15 AM EDT

Sasan Goodarzi, president and chief executive officer of Intuit.

GETTY

Intuit will tell approximately 1,800 of its global employees—10% of its workforce—they will be leaving the company. But leadership says the move isn't to cut costs.

Sasan Goodarzi, CEO of the Fortune 500 company, which offers products like QuickBooks, Credit Karma, and TurboTax, wrote an internal email to employees, seen by Fortune, announcing the "very difficult decisions my leadership team and I have made."

Related Video

Goodarzi explains that Intuit's transformation journey, including departing from the 1,800 employees, is part of its strategy to increase investments in priority focus areas of AI and generative AI, such as its GenAI-powered financial assistant called Intuit Assist, and reimagining its products from traditional workflows to AI-native experiences. The strategy also focuses on money movement, mid-market expansion for small businesses, and international growth.

"We do not do layoffs to cut costs, and that remains true in this case," Goodarzi writes. Intuit plans to hire approximately 1,800 new people with strategic functional skill sets primarily in engineering, product, and customer-facing roles such as sales, customer success, and marketing—and expects its overall headcount to grow in its fiscal year 2025, which begins Aug. 1.

Of the employees who will depart Intuit, 1,050 are not meeting expectations based on a formal performance management process. The company believes they will be "more successful outside of Intuit," Goodarzi writes. In addition, Intuit is reducing the number of executives—directors, SVPs, and EVPs—by approximately 10%, expanding certain executive roles and responsibilities.

Intuit is also consolidating 80 tech roles to sites where it is growing technology teams, including Atlanta, Bangalore, New York, Tel Aviv, and Toronto. The company is closing two sites in Edmonton and Boise that have over 250 employees, with a certain number of employees relocating to other sites within Intuit or leaving the company. Intuit is also eliminating more than 300 roles across the company to "streamline work and reallocate resources toward key growth areas," according to the email.

All departing U.S. employees will receive a package that includes a minimum of 16 weeks of pay, plus two additional weeks for every year of service. They will have 60 days before they leave the company, with a last day of Sept. 9. Employees outside the U.S. will receive similar support, taking into account local requirements.

"This timing allows everyone leaving to reach their July vesting date for restricted stock units and the July 31 eligibility date for annual IPI bonuses," Goodarzi writes. Those not on an IPI plan will be able to reach the eligibility date for July or Q4 incentives. It's the most generous severance package Intuit has ever offered, according to the company.

"Intuit is in a position of strength," according to Goodarzi. The company earned $14.4 billion in revenue in its fiscal year 2023, moving up 24 spots on the Fortune 500. For the period ending April 30, Intuit reported revenue of $6.7 billion, up 12%.