Dropbox to shed another 500 staff, CEO takes 'full responsibility'
(2024/11/01)
- Reference: 1730415853
- News link: https://www.theregister.co.uk/2024/10/31/dropbox_layoffs/
- Source link:
Cloudy file-shifter Dropbox has axed about 20 percent of its staff, its second round of layoffs in less than two years.
CEO Drew Houston said some parts of the business are, but cuts were needed where the company had over-invested or underperformed. In all, 528 staff will be let go.
"As CEO, I take full responsibility for this decision and the circumstances that led to it, and I’m truly sorry to those impacted by this change," [1]wrote Houston, who is keeping his job.
[2]
"I know this is incredibly difficult and unwelcome news. To everyone leaving Dropbox, I’m deeply grateful for everything you've done for our company and our customers."
[3]Dropbox drops 16% of staff, points finger at hard-up customers and AI
[4]Dropbox dropped the ball on security, hemorrhaging customer and third-party info
[5]The truth about Dropbox opening up your files to AI – and the loss of trust in tech
[6]Dropbox drops bucks to ditch digs in long-term WFH model
The biz expects the layoffs to cost around $63-$68 million, since staff will get a minimum of 16 weeks' pay and will receive their Q4 2024 equity vesting. They can also get to keep their office equipment for personal use.
Last year, Dropbox [7]laid off 16 percent of its staff, blaming the effect of AI and a maturing market on its woes. It still turned in a profit that year and has made a big bet on its Dash AI search tool, which [8]it's developing in partnership with Nvidia.
[9]
Dropbox recently reported under two percent revenue growth, and revenue of $634.5 million. However, it has found $540 million to spend on share repurchases in the first half of this year to support the stock price, [10]and says it has another $868 million available for more share buybacks as of June 30. ®
Get our [11]Tech Resources
[1] https://blog.dropbox.com/topics/company/an-update-from-drew
[2] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_offprem/saas&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=2&c=2ZyRgejfmiQq7f-id6OBFTQAAAQI&t=ct%3Dns%26unitnum%3D2%26raptor%3Dcondor%26pos%3Dtop%26test%3D0
[3] https://www.theregister.com/2023/04/27/dropbox_ai_layoffs/
[4] https://www.theregister.com/2024/05/02/dropbox_sign_attack/
[5] https://www.theregister.com/2023/12/15/dropbox_ai_training/
[6] https://www.theregister.com/2023/10/23/dropbox_shrinks_hq/
[7] https://www.theregister.com/2023/04/27/dropbox_ai_layoffs/
[8] https://nvidianews.nvidia.com/news/dropbox-and-nvidia-team-to-bring-personalized-generative-ai-to-millions-of-customers
[9] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_offprem/saas&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44ZyRgejfmiQq7f-id6OBFTQAAAQI&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[10] https://dropbox.gcs-web.com/static-files/622c0bdf-03df-4ba7-a803-aff8ea91fca4
[11] https://whitepapers.theregister.com/
CEO Drew Houston said some parts of the business are, but cuts were needed where the company had over-invested or underperformed. In all, 528 staff will be let go.
"As CEO, I take full responsibility for this decision and the circumstances that led to it, and I’m truly sorry to those impacted by this change," [1]wrote Houston, who is keeping his job.
[2]
"I know this is incredibly difficult and unwelcome news. To everyone leaving Dropbox, I’m deeply grateful for everything you've done for our company and our customers."
[3]Dropbox drops 16% of staff, points finger at hard-up customers and AI
[4]Dropbox dropped the ball on security, hemorrhaging customer and third-party info
[5]The truth about Dropbox opening up your files to AI – and the loss of trust in tech
[6]Dropbox drops bucks to ditch digs in long-term WFH model
The biz expects the layoffs to cost around $63-$68 million, since staff will get a minimum of 16 weeks' pay and will receive their Q4 2024 equity vesting. They can also get to keep their office equipment for personal use.
Last year, Dropbox [7]laid off 16 percent of its staff, blaming the effect of AI and a maturing market on its woes. It still turned in a profit that year and has made a big bet on its Dash AI search tool, which [8]it's developing in partnership with Nvidia.
[9]
Dropbox recently reported under two percent revenue growth, and revenue of $634.5 million. However, it has found $540 million to spend on share repurchases in the first half of this year to support the stock price, [10]and says it has another $868 million available for more share buybacks as of June 30. ®
Get our [11]Tech Resources
[1] https://blog.dropbox.com/topics/company/an-update-from-drew
[2] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_offprem/saas&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=2&c=2ZyRgejfmiQq7f-id6OBFTQAAAQI&t=ct%3Dns%26unitnum%3D2%26raptor%3Dcondor%26pos%3Dtop%26test%3D0
[3] https://www.theregister.com/2023/04/27/dropbox_ai_layoffs/
[4] https://www.theregister.com/2024/05/02/dropbox_sign_attack/
[5] https://www.theregister.com/2023/12/15/dropbox_ai_training/
[6] https://www.theregister.com/2023/10/23/dropbox_shrinks_hq/
[7] https://www.theregister.com/2023/04/27/dropbox_ai_layoffs/
[8] https://nvidianews.nvidia.com/news/dropbox-and-nvidia-team-to-bring-personalized-generative-ai-to-millions-of-customers
[9] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_offprem/saas&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44ZyRgejfmiQq7f-id6OBFTQAAAQI&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[10] https://dropbox.gcs-web.com/static-files/622c0bdf-03df-4ba7-a803-aff8ea91fca4
[11] https://whitepapers.theregister.com/
Time to pull out
Yorick Hunt
If you have shares in this rusty barge, it's time to pull out now. When they resort to share buybacks for the purpose of share price manipulation, you know the business has evaporated and is now purely a carcass being squeezed for the last few drops of blood.
"As CEO, I take full responsibility for this decision and the circumstances that led to it, and I’m truly sorry to those impacted by this change," wrote Houston - Well, that makes the newly-unemployed feel much better, I'm sure!