F5 Inc, a leading cloud and security services company, announced on Wednesday that it would be implementing cost-cutting measures, including a 9% reduction in its workforce and a reduction in bonuses for senior executives. The move comes as the technology industry grapples with slowing growth after a pandemic-led boom in digital services, which has led to layoffs across the sector.
As part of its downsizing plan, F5 will be cutting 623 jobs and reducing spending on office space and executive travel. The company’s CEO, François Locoh-Donou, acknowledged the impact of rising interest rates, geopolitical events, and macroeconomic uncertainty on customer spending patterns, and emphasized the need to decrease costs while preserving future growth prospects.
In an email to staff shared in an exchange filing, Locoh-Donou stated, “It’s clear that rising interest rates, geopolitical events, and macroeconomic uncertainty have dramatically affected our customers’ spending patterns… we must take measures to decrease our costs without jeopardizing our future growth trajectory.”
Additionally, F5 revised its fiscal 2023 revenue growth forecast to “low-to-mid single-digit” from its earlier projection of 9% to 11% growth. This revision caused a 5% drop in the company’s shares during after-market trading.
F5 Inc is based in Seattle, Washington, and is known for its cloud and security services, providing solutions to help businesses optimize their applications, protect their data, and ensure reliable and secure access to their networks. The company’s cost-cutting measures reflect the challenges faced by the technology industry and its commitment to managing costs while navigating uncertain market conditions.