Can someone help me understand why sales is immune to this strategy and still is employing the “more bodies” approach. I thought we were working smarter in 2026?
What's normal in USA for this size of company?
AI is used to justify the redundancies, and the company still expects to grow in this fiscal year. In the SEC filling the specifically mention more “head count” in “go-to-market” roles [1].
> a reduction of approximately 7% of our workforce
> Advances in AI, automation, and technology are reshaping how work gets done, and we're changing with them. (…) That's what this reorganization is for: a simpler structure, with fewer layers, less complexity, and less friction.
> The changes we announced today are a sign of confidence in the business, not a retreat from it. We continue to invest in key growth areas and expect total headcount to grow year-over-year this fiscal year [the SEC filling says “ The Company plans to continue hiring in key strategic areas and locations, including continuing to grow headcount in customer-facing go-to-market functions, and expects total headcount to grow this fiscal year compared to last fiscal year, as it continues to invest in future growth opportunities”]
[1]: https://ir.elastic.co/financials/sec-filings/sec-filings-det...
Another commenter questioned what size bucket Elastic falls into these days; in April 2025 their SEC filing [2] cited about 3,500 employees. So not a startup any more but definitely not fully-fledged FAANG-sized.
(not sure whether it even applies here; but full disclosure, I left Elastic in 2022.)
[1]: https://www.elastic.co/blog/ceo-ash-kulkarni-email-to-elasti... [2]: https://www.sec.gov/Archives/edgar/data/1707753/000170775325...
“Because of AI” indeed.
The underlying message is a lot clear - they are a public company. They have to do this and more show to net positive income to keep the market value from falling further.
Companies can keep the employees with market value drop but it gets hard with negative income. Salesforce also lost ~37% value in last 5 years but they still print billions in net income every year.
The same story with companies like Gitlab. They lost 75% market value and negative income since going public.
They lost a lot of goodwill back then. Some of their potential customers migrated to OpenSearch and never looked back, even after they backed down and went open-source again under AGPL.
Unionize, brothers and sisters!
Wouldn't that suggest you need those workers more?
https://www.entrepreneur.com/business-news/nvidias-jensen-hu...
It's never AI. In almost every case, companies that claim it's AI are doing so because reducing headcount due to "automating with AI" sounds better than the real reason, often over hiring, financial troubles and other reasons that might scare investors away.
The correct term is usually AI Washing.
More info: https://www.thehrdigest.com/what-is-ai-washing-and-why-has-i...
I think open source is important and fair use is important, but I’m skeptical of the business model of gutting open source by hosting it and reselling it wholesale with a few modifications.
Amazon, Google and Microsoft are getting rich just reselling hosted open source and actively competing with and gutting companies like Elastic.
If they are in an outstanding position why did he make 7% of the employees lives miserable with a stroke of a pen.
:laughing:
> To do it, we're shifting our pace of innovation, simplifying how we operate, and investing in new skills. That's what this reorganization is for: a simpler structure, with fewer layers, less complexity, and less friction.
Translation: We're going to run the remaining people ragged.
> That means fewer layers, broader ownership, clearer accountability, and a sharper focus on the skills we believe matter most for what's ahead.
Yeah the people remaining are cooked.
It's never "we're going to hire more people to build lots of cool stuff" it's always giving fewer people quadruple the responsibility expectation.
Too bad, so bad?
