Thomas Kurian, CEO of Google Cloud, speaks at a cloud computing conference held by the company in 2019.
Michael Short | Bloomberg | Getty Images
Google (GOOG), in a move signaling a continued strategic shift towards artificial intelligence, has laid off over 100 employees within its design teams, CNBC has learned. The reductions, impacting key user experience research and platform and service experience teams within Google Cloud, reflect a broader realignment of resources within the tech giant.
Sources familiar with the matter indicate that the layoffs primarily affect roles focused on leveraging data-driven insights to inform product development and design strategies. Notably, some design teams within Google Cloud have reportedly been halved, with a significant portion of the impacted roles being based in the United States. Affected employees have been given a window until early December to explore internal opportunities within Google.
While Google has not yet issued an official statement regarding the layoffs, the cuts align with the company’s stated objective to prioritize investment in AI infrastructure. This strategic pivot comes as Google faces increasing competition in the generative AI space from rivals like Microsoft, which has heavily invested in OpenAI.
The design team adjustments follow a series of cost-cutting measures implemented by Google throughout the year. These include voluntary exit packages offered to various U.S.-based divisions, including human resources, hardware, search, advertising, marketing, finance, and commerce. Furthermore, the company has reportedly reduced its management ranks by over a third, streamlining its organizational structure.
These moves are consistent with comments made earlier this year by Google CEO Sundar Pichai, who emphasized the need for increased efficiency and a more streamlined approach to resource allocation. “We need to be more efficient as we scale up so we don’t solve everything with headcount,” Pichai stated, foreshadowing the recent organizational changes.
The layoffs signal a potential shift in Google’s design philosophy, moving away from larger, more distributed teams towards a leaner, potentially more AI-driven approach. The company may be looking to leverage AI tools to automate certain aspects of the design process, reducing the need for human designers in specific areas. This strategy could also lead to a greater emphasis on data-driven design, with AI algorithms playing a more prominent role in shaping user experiences.
Google’s move reflects a wider trend in the tech industry, with other major players like Microsoft (MSFT) and Meta (META) also implementing workforce reductions. These companies are navigating a challenging economic environment and are under pressure to demonstrate profitability while simultaneously investing in emerging technologies like AI and the metaverse. The industry-wide adjustment signals a period of intense competition and technological disruption, where companies are forced to make difficult decisions about resource allocation to maintain their competitive edge.
