Dropbox has laid off 500 employees. This is about 16 percent. Dropbox CEO Drew Houston attributed the layoffs in to the rocky economy, but said that the cuts would allow the company’s AI division to grow.
In an ideal world we would simply swap people from one team into another. Houston writes, “We’ve done this wherever possible.” Houston writes, “However our next stage requires a new mix of skills, especially in AI and early product development. Over the past couple of years, we have brought in great talent to these areas and will need more.
Houston said that Dropbox is consolidating its core business and document workflow, and also adjusting its product development team. Houston says that Dropbox remains “profitable” in spite of tough economic times, and that job cuts are part the “natural maturation of the Dropbox business”.
Houston says that the changes announced today are painful but necessary for the future. I’m determined that Dropbox will be at the forefront in the AI era just as we were with the move to mobile and cloud. Machine intelligence will give us the ability to reinvent our businesses and create new ones. We’ll all need to be on board.
Houston has previously expressed an interest in AI. In a letter from Houston and Arash Ferdowsi , dated 2018, they stated that “machine-intelligence” would allow Dropbox to understand and better serve its customers. File hosting service Dropbox has added AI-powered features in the past, including the automatic recognition of text that it introduced in 2018. Dropbox’s decision to lay off workers in order to hire AI-experienced employees is a sign that it is serious about reshaping the industry.
Employees who are affected will receive up to six months’ worth of healthcare and be allowed to keep their company-issued devices for personal usage. The employees will also receive job placement assistance and career coaching.