Intuit Announces AI-Focused Reorganization Plan, Including Layoffs of 1,800 Employees

In a significant move towards AI integration, Intuit, the tax preparation and financial software company, has unveiled a reorganization plan that involves cutting approximately 10% of its workforce. The company, known for QuickBooks and TurboTax, is set to lay off 1,800 employees but anticipates hiring a similar number by fiscal 2025 as it ramps up its focus on artificial intelligence within its offerings. CEO Sasan Goodarzi explained that over 1,000 of the job cuts were due to employees not meeting the company's standards, with an additional 300 positions being eliminated to streamline operations and redirect resources towards key growth sectors. Intuit, headquartered in Mountain View, California, will also shutter offices in Boise, Idaho, and Edmonton, Alberta, affecting more than 250 employees, some of whom may relocate to different sites. Goodarzi emphasized the transformative impact of AI, stating that companies failing to embrace this technological revolution risk falling behind and eventually becoming obsolete. The company assured that laid-off U.S. staff will receive a minimum of 16 weeks' pay, with additional compensation based on years of service and at least six months of health insurance coverage. Employees were given a 60-day notice of termination, with the final day set for September 9. Intuit estimated that the reorganization will result in charges ranging from $250 million to $260 million, primarily in its fiscal fourth quarter ending on July 31. Following the announcement, Intuit's shares experienced a 3.6% decline in morning trading, reaching $626.29 per share. The restructuring at Intuit underscores a strategic shift towards AI integration, with workforce adjustments aimed at aligning resources with the company's evolving priorities. The move to downsize and reallocate staff reflects a broader industry trend towards leveraging artificial intelligence to enhance product offerings and operational efficiency. Despite the layoffs, Intuit remains optimistic about its future prospects, projecting a rebound in employment figures as it embraces AI technologies to drive innovation and competitiveness in the market. The company's commitment to supporting affected employees through severance packages and benefits underscores its efforts to navigate this transition period with a focus on employee welfare and long-term sustainability.