Intuit is at a crucial turning point. The company stressed the importance of using AI to advance business innovation. As Intuit deals with these challenging times, it sees both obstacles and opportunities to grow.
Moving ahead depends on using technology better and managing how these changes affect people.
Intuit has stressed the importance of using AI to advance business innovation.Scott Olson/Getty Images
AI-Driven Transformation, Workforce Adaptation of Intuit
Known for tax preparation software like QuickBooks and TurboTax, Intuit revealed a strategic overhaul centered on artificial intelligence. As part of this initiative, the company plans to lay off approximately 1,800 employees, constituting around 10% of its workforce.
Associated Press reported that Intuit CEO Sasan Goodarzi communicated in an internal email that over 1,000 of these job cuts were attributed to performance issues not meeting the company's new standards.
Despite the layoffs, Intuit anticipates hiring a comparable number of employees in fiscal 2025 as it intensifies efforts to integrate AI across its product lineup. Intuit's recent email announced eliminating 300 more positions to streamline operations and redirect resources to areas poised for growth.
The company, headquartered in Mountain View, California, will also close offices in Boise, Idaho, and Edmonton, Alberta, Canada, affecting over 250 employees. Intuit noted that some affected employees can relocate to other sites in the company.
In a recent email to staff, Goodarzi emphasized the transformative impact of AI technology, highlighting its pivotal role in shaping the future of businesses. He underscored the importance of embracing this AI revolution to stay competitive in the evolving market landscape.
As Intuit moves forward, its success will hinge on effectively integrating AI and supporting its workforce through these changes. It aims to improve efficiency, innovate, and deliver value to shareholders in a competitive market.
Regarding severance packages, Intuit assured that all laid-off US employees would receive a minimum of 16 weeks' pay, an additional two weeks for each year of service, and at least six months of continued health insurance coverage.
Employees were notified of their termination 60 days in advance, with a final workday set for September 9. According to a regulatory filing, Intuit projected expenses between $250 million and $260 million for the reorganization plan, primarily slated for its fiscal fourth quarter ending July 31.
Following this announcement, Intuit's shares dipped 3.6% in morning trading to $626.29 per share. Intuit's strategic reorganization underscores its commitment to leveraging AI technology for future growth, even though it means cutting jobs.
They're offering good severance packages to help employees through this change. The company expects to spend a lot on this restructuring soon, which caused its stock price to drop a bit. Intuit's future success will depend on how well it uses AI and manages these big changes to stay competitive and keep investors happy.
