Identity management company Okta has revealed its intention to reduce its workforce by around 7%, resulting in the departure of approximately 400 employees, according to a recent internal communication to employees.
The move, announced by CEO Todd McKinnon, underscores the company’s ongoing efforts to address financial concerns and optimise operational efficiency.
Despite the downsizing, Okta claims to remain committed to meeting its previously stated financial expectations.
The announcement had an immediate impact on Okta’s stock performance, with shares rising approximately 3.6% during premarket trading.
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The layoffs follow the company’s previous round of cuts in February 2023, where around 300 employees were affected.
Okta, boasting a customer base of more than 18,000, reported better-than-expected quarterly earnings in November, with a notable 21% increase in revenue, totalling $584m.
The downsizing trend appears to be a wider industry phenomenon in 2024, with major tech players like Alphabet and Amazon also announcing layoffs this month.
Layoffs.fyi, a website tracking tech workforce reductions, has recorded 115 tech companies with layoffs affecting 30,375 employees.
The announcement from Okta coincides with cybersecurity giant Proofpoint’s confirmation of a 6% reduction in its global workforce, affecting 280 employees.
This collective trend of tech companies implementing workforce adjustments underscores the ongoing challenges and adjustments within the industry.
The widespread adoption of generative artificial intelligence and a flurry of regulatory setbacks have played a big role in shaping these workforce decisions.
