Intuit fires 1,800 employees. Why? To double down on AI investments

• And another tech layoff due to AI! Are you keeping count?
• Intuit, the powerhouse behind QuickBooks, TurboTax, and Credit Karma, is letting go of 10% of its total workforce.
• But here is the catch… At the same time, they are hiring 1800 people in other departments.
• Here is the rundown.

Layoffs at Intuit

Intuit, the powerhouse behind QuickBooks, TurboTax, and Credit Karma, is letting go of 1,800 employees—that is around 10% of its total workforce.

The company is also trimming its executive ranks by about 10% and consolidating tech roles in growing hubs like Atlanta and Bangalore.

All U.S. employees will have a 60-day transition period before their final day with the company, which is set for September 9, 2024.

How will they get compensated?

For those fired in the US, Intuit is offering a robust severance package, including a minimum of 16 weeks of pay plus additional benefits.

The company has ensured that departing employees will reach key vesting dates for stock units and bonuses.

Also read: Dell fires 12500 employees in bold restructuring Why? To fuel AI ambitions

Reasons for trimming its workforce?

Focus on AI: In an internal email, CEO Sasan Goodarzi emphasized that this isn’t about cutting costs, but these layoffs are part of a broader strategy to ramp up investments in artificial intelligence (AI) and generative AI.

Performance-based departures: However, the email also revealed that out of the 1,800 employees leaving, 1,050 didn’t meet expectations in their performance management process.

1,800 new hires in key areas

While 1,800 employees will depart, Intuit plans to hire an equal number of new people with expertise in,

• Engineering
• Product development
• Customer-facing roles

This move is part of a larger plan to grow the company’s overall headcount in fiscal year 2025, starting August 1.

Also read: Reliance layoffs 11% of its workforce, totaling 42,000 employees 

Future plans

• They’ve already introduced their GenAI financial assistant, Intuit Assist. Now they are pushing the envelope to create AI-native experiences that move beyond traditional workflows, offering clients a whole new level of service.
• They’re also looking to expand in areas like money movement, mid-market growth for small businesses, and international expansion.

About Intuit

Intuit Inc. is a leading American multinational known for its financial software solutions. Based in Mountain View, California, Intuit offers a range of products including TurboTax for tax prep, QuickBooks for small business accounting, Credit Karma for credit monitoring, and Mailchimp for email marketing.

Revenue: Intuit’s revenue for the twelve months ending April 30, 2024, reached $15.81 billion, marking a 12.39% year-over-year increase.

Leadership

Chief Executive Officer – Sasan Goodarzi

Executive Vice President

Chief Financial Officer – Sandeep Aujla

Executive Vice President, Chief Technology Officer Alex Balazs

Executive Vice President, Chief People & Places Officer – Laura Fennell

Wrapping up

While the focus on AI is undoubtedly forward-looking, the move raises questions about the impact on company culture and employee morale.

Will this gamble pay off in the long run?