Atlassian and Oracle are the latest software-focused multinationals to prepare for layoffs in the wake of expanding use of AI sector-wide.
Australian tech giant Atlassian has announced it will cut 10 per cent of its workforce – around 1,600 staff – as it prepares to expand its AI offering. The move responds to fears that AI products could render its current business model obsolete.
Atlassian’s co-founder and chief executive, Mike Cannon-Brookes, said in a note to staff that “It would be disingenuous to pretend AI doesn’t change the mix of skills we need or the number of roles required,” and that the terminations will largely spare “Atlassians with the skills to help us thrive as an AI-first company”. This includes “strong performers, graduates and Atlassians with transferable skills,” he said.
Over 900 of the affected staff work in software research and development, the company says, reflecting the growing role that AI is playing in product development and codebase maintenance.
The Guardian reported that the layoffs came as a surprise to those affected, with no prior consultation or indication that their jobs were in danger.
Atlassian shares have fallen by over 50% since January, and today’s announcement appears to have done little to stem the decline, with the company closing 3.28% lower than at the start of trading.
Across the Pacific, Oracle has set aside an additional $500 million to cover restructuring costs, bringing its total for the year to $2.1 billion. Of this, it has used only $928 million, leaving over a billion dollars available for restructuring before the end of May.
The Financial Times reported that staff have not been informed of plans for layoffs, but that co-chief executives Clay Magouyrk and Mike Sicilia told staff at an all-hands meeting on 11 March that AI could be used to automate a number of coding functions.
Oracle has already cut 3,000 jobs this fiscal year, and the remaining restructuring funds would enable redundancies of a similar scale again in the coming months, though this has not been confirmed by the company.
