DocuSign, a leading e-signature software company, has announced that it will be cutting around 10% of its workforce, affecting approximately 700 employees.
Previous Layoffs
This follows a previous round of layoffs in September 2021 that impacted 9% of the company’s workforce. The restructuring is aimed at supporting DocuSign’s growth, scale, and profitability objectives. The company has 7,461 employees as of January 2022.
The restructuring plan is expected to be completed by the end of the second quarter of 2023. DocuSign has indicated that it will take an impairment charge of around $25 million to $35 million, primarily in the first quarter of fiscal 2024, due to the layoffs.
Impact
The company spokesperson has clarified that the restructuring mainly impacts DocuSign’s worldwide field organization, which allows the company to reshape itself more effectively for profitable growth while freeing up resources for investments. The move by DocuSign is part of a trend that has been observed across the tech industry. Company layoffs trigger other companies to do layoffs, and so on. Rising interest rates and reduced consumer spending have also caused some layoffs.
DocuSign Shares
Despite the announcement, DocuSign’s shares were up about 3% in afternoon trading on Thursday. The company remains committed to its digital self-service motions, and its CEO, Dan Springer, has stated that he is pushing growth in this area. The company is confident that the restructuring plan will help it achieve its growth and profitability goals.
Summary
In summary, DocuSign’s decision to cut approximately 700 employees is aimed at supporting its growth, scale, and profitability objectives. The restructuring is expected to be completed by the end of the second quarter of 2023, and an impairment charge of around $25 million to $35 million will be taken primarily in the first quarter of fiscal 2024. Despite concerns around the tech industry, DocuSign is committed to digital self-service motions and confident that the restructuring plan will help it achieve its goals.
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