California Tech Giant Intuit to Lay Off 10 Percent of Workforce in Shift to AI

California-based financial software provider Intuit has announced plans to fire 1,800 employees, or roughly 10 percent of its workforce, and bring in new recruits beginning next financial year, in a shakeup designed to further its AI-focused reorganization plan.

The move is part of the tech giant’s push to “reallocate resources to key growth areas,” specifically incorporating artificial intelligence (AI) into its products and services, according to a July 10 regulatory filing by the multinational company, which offers software products including QuickBooks, ProConnect, TurboTax, and more.

In a July 10 blog post on the company’s website, Intuit CEO Sasan Goodarzi told employees that offices in Boise, Idaho, and Edmonton, Canada, will close, although some workers from those offices will transfer to new locations.

Mr. Goodarzi said more than 1,050 employees are being laid off for not meeting the company’s expectations, while 300 positions are being eliminated “to streamline work,” as the company looks to consolidate about 80 tech jobs to Atlanta; Bangalore, India; New York; Tel Aviv, Israel; and Toronto.

Employees fired in the shakeup will leave the company on Sept. 9, giving them about 60 days to find new employment, the company said.

“AI is igniting global innovation at an incredible pace, transforming every industry and company in ways that were unimaginable just a few years ago,” Mr. Goodarzi said in the blog post. “Companies that aren’t prepared to take advantage of this AI revolution will fall behind and, over time, will no longer exist.”

Overall Company Headcount Expected to Grow

However, Mr. Goodarzi said Intuit will hire about 1,800 employees in 2025 as part of its wider plan to reorganize the company and expects the “overall headcount to grow” in the 2025 financial year and beyond.

“The changes we are making today enable us to allocate additional investments to our most critical areas to support our customers and drive growth,” he said. “This includes reinvesting in the necessary skills and capabilities to support these areas.”

The recruits will be primarily for “engineering, product, and customer-facing roles such as sales, customer success, and marketing,” he said.

According to the regulatory filing, affected U.S. employees will get at least 16 weeks of pay, plus two additional weeks for every year of service; six months of health insurance coverage; and other support to find new jobs as part of their severance packages. Intuit estimates it will incur between $217 million and $227 million in severance payments and employee benefits and $33 million in noncash charges for share-based compensation and costs associated with the site closures.