Salesforce (CRM), out of a massive second quarter and ready to be added to the Dow Jones Industrial Average, is like any other company operating in a pandemic – having to make “difficult decisions” such as reducing the percentage, told CEO Mark Benioff Yahoo Finance,
The billionaire explained that job cuts, especially in a pandemic, are part of running a successful business. According to The Wall Street Journal, Salesforce eliminates about 1,000 jobs, giving affected workers 60 days to find new positions within the company.
The move comes at a time when unemployment is at its highest level in years. Yet with 54,000 employees, the job cuts are less than 2% of the total percentage. Typically, Salesforce looks to “rebalance five to 10%” of its employees each year, Benioff said Wednesday.
“It’s part of running our business successfully. And that affects employees at different times,” he said during an interview.
“And at this point, in this quarter, we will unfortunately have to make changes in how our employees are structured and exactly where we invest,” Benioff added.
On the Q2 revenue call, CFO Mark Hawkins seemed to point out the looming cuts on jobs. He stated that the company would be “making a strategic shift in investments today to better position our company for continued growth and customer success in this new, all-digital, work-from-anywhere business.”
On the surface, the bottom line of Salesforce certainly does not seem to hurt. The software giant’s record second-quarter results, with revenue for the first time above $ 5 billion. Benioff called the results “a victory for stakeholder capitalism” during an analyst call.
The next day, Salesforce’s share had its best day on record, with shares rising more than 26% to close at $ 272.32, up $ 56.27.
The 55-year-old billionaire tech boss added that the company offers re-skilling and re-training, in addition to placement services, for those affected by the job cuts.
“The idea that we will do good and do good also means that we will become an example of what capitalism of stakeholders means. At the end of the day, we are still running a business, and we are going to have to keep going. with making investment choices, ‘Benioff explained.
“But we will do it in the best way, a more compassionate way, a more sustainable way, a fairer way, and a more just way. And we will be an example of exactly how to do that,” he said.
He noted that since its launch in 2004, Salesforce’s share had returned more than 5,000%, and the company has “returned very dramatically” to the communities in which it operates.
When Benioff Salesforce started in 1999, he made integrated philanthropy a critical part of its mission. This month, Salesforce, which previously hired more than 100 public schools, donated $ 20 million to five school districts to help bridge the digital divide as students and teachers continue to learn from home during the pandemic. To date, Salesforce has contributed $ 118 million to its local public schools.
In early April, Salesforce and Benioff also made it clear to their employees that there would be no redundancies for 90 days amid the uncertainty.
“Well, we’ve written our pandemic plan, we’re reshaping our business. We’re reassessing what Salesforce will look like next year,” Benioff told Yahoo Finance.
However, he praised the company’s current performance, noting that “there has never been a business software company that delivered a quarter of $ 5 billion at 29%.”
He added: “That is why it is really critical for us to continue to make the changes, the additions, the shifts, so that we can continue to grow, so that we can remain successful.”
Julia La Roche is a correspondent for Yahoo Finance. Follow them up Twitter.
