Adobe Enters Layoff Race! The Tech Giant Cuts Jobs to Balance Expenses

As Adobe enters layoff race, the Figma deal, considered to be critical for it, comes into focus

Finally, Adobe enters the layoff race! The software company yesterday announced a round of layoffs. As per reports, it will lay off around 100 employees, mostly from the sales team. Few of the sacked employees were shifted to other critical positions at the software company, according to a report published in Bloomberg – a trend that is not seen in the case of big-tech layoffs. "Adobe is not doing company-wide layoffs and we are still hiring for critical roles," the software major said in a statement. Adobe job cuts are smaller in number compared to the thousands of employees terminated by big-tech companies. According to company filings, Adobe employed nearly 27,000 people in the fiscal third quarter of September 2022. "In this digital-first world, Adobe Creative Cloud, Document Cloud, and Experience Cloud have become even more mission-critical to an increasingly wide range of customers," Adobe CEO Shantanu Narayen said.

At the surface level, Adobe layoffs do look like a cost-saving measure given the fact that its stock has tumbled 42% because of the software industry slump but its revenue in the last quarter and it hired a hefty number of employees in Q3 when its revenue was $4.43 billion, a 15% year over year growth. Adobe employee strength always varied between 21K to 25K and with the recent hiring it should have gone up to 50K. What piques one's interest is the fact that why would Adobe transfer a handful of employees to another department that too on the pretext of savings? The company, in fact, at the 'Adobe Max 2022' conference held in October, had announced an increase in headcount by a lower percentage in the coming years. "Adobe's continued success in this uncertain macroeconomic environment underscores that our solutions are mission-critical to a growing universe of customers," said its CEO Shantanu Narayen.

Just a few months back Adobe announced the acquisition of Figma, one of its smaller rivals for $20 billion, making it one of the largest prices ever paid for a private software company. It is a deal that is considered to be the centerpiece of one of the biggest transformations in its 40-year history. The creative community was very much against the deal for fear of Figma, a simple and inexpensive tool compared to Adobe which charges $55 per month for a bundle of desktop programs. While users protested with messages, '#FreeFigma', and 'Make Figma Great Again', the US Department of Justice issued orders for investigating the deal for potential antitrust issues. The company is scheduled to report its Q4 results on December 15^th.