Microsoft GitHub today announced that it is laying off 10% of its employees to reduce costs. It is important to note that GitHub announced hiring pause last month. Along with the layoffs, GitHub also announced a number of other measures to cut costs.
First, GitHub is going fully remote. GitHub noticed very low utilization rates in its offices around the world. Even though it is not vacating offices immediately but will move to close all of its offices as their leases end.
Second, GitHub will be migrating to Microsoft Teams for its video conferencing needs. It will continue to use Slack for internal chat communications.
Sustained growth is important for every business.
Thomas Dohmke, CEO of GitHub, sent the following email to GitHub employees today.
“Today, we are announcing a number of difficult decisions, including saying goodbye to some Hubbers and enacting new budgetary realignments, designed to protect the short-term health of our business while also granting us the capacity to invest in our long-term strategy. With great respect for Hubbers, I first want to be clear about why we are making these decisions and what it means for GitHub’s future.
Sustained growth is important for every business. For GitHub, this means that we continue to enable more productive developers across the globe and move quickly as our opportunities to help our customers change. Today, we are the home of 100M developers, and we must become the developer-first engineering system for the world of tomorrow. The age of AI has started and we have been leading this change with GitHub Copilot, our most successful product launch to date. We have an enormous opportunity to build an integrated, AI-powered GitHub with urgency. We must continue to help our customers grow and thrive with GitHub, expedite and simplify their cloud adoption journey, while supporting them every day. This will require strong focus and changes to how and where we invest our finite resources.
To start, we will align our work with the areas where we can best impact these goals and our customers’ needs across all of our products. Unfortunately, this will include changes that will result in a reduction of GitHub’s workforce by up to 10% through the end of FY23. A number of Hubbers will receive notifications today, others will follow as we are re-aligning the business through the end of FY23. The hiring pause that I announced on January 18 remains in effect.
Although our entire leadership team has carefully deliberated this step and come to agreement, ultimately, as CEO the decision is mine. I recognize this will be difficult on you all, and we will approach this period with the utmost respect for every Hubber. We will speak with impacted Hubbers so that they understand the transition compensation and COBRA/COBRA equivalent (outside the US) that will be provided. Career transition services assistance benefits will also be offered.
Additionally, we have been working to improve our operational efficiency and scale as a business. One of our decisions is to move toward a fully remote GitHub. We are seeing very low utilization rates in our offices around the world, and this decision is a testament to the success of our long-standing remote-first culture. We are not vacating offices immediately, but will move to close all of our offices as their leases end or as we are operationally able to do so. We will share more workplace details and transition plans with you as they are finalized.
We are looking at further reducing our operating costs. We will share details and transition plans with you in the coming months, but I wanted to share two decisions with you: i) Effective immediately, we will be moving laptop refreshes from three years to four years. ii) We will be moving to Microsoft Teams for the sole purpose of video conferencing, saving significant cost and simplifying cross-company and customer conversations. This move will be complete by September 1, 2023. We will remain on Slack as our day-to-day collaboration tool.
Finally, I want to extend my deepest gratitude to every single Hubber and their incredible talents that have helped GitHub grow to where we are today. Every commit you have made and every day you have worked has helped construct GitHub into the largest and most important software development platform. Thank you for your dedication, resilience, and passion to empower millions of software developers around the globe.”