Credit: Shutterstock/T. Schneider.

Toast, a provider of restaurant management software, revealed on Thursday (16 February) its decision to cut approximately 10% of its workforce, amounting to 550 employees.

While the company reported better-than-expected fourth-quarter earnings, the announcement came in response to a visible slowdown in growth after robust acceleration in 2021.

Despite initial positive market reactions, with Toast’s shares surging up to 16% after hours, the gains were subsequently pared back.

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The layoff move aligns with a broader trend in 2024, as several technology companies, including Cisco, have implemented workforce reductions amid challenging market conditions.

In an effort to boost shareholder value, Toast has committed $250m for share buybacks.

The surge in demand for Toast’s tools during the pandemic, facilitating mobile ordering and payments for restaurants, led to a doubling of the company’s revenue.

However, the growth trajectory has waned, dropping from 45% in the second quarter to 37% in the third quarter.

These developments follow the recent change in leadership, with Aman Narang, Toast’s co-founder and COO, taking over as CEO from Chris Comparato.

According to data from layoffs.fyi, more than 150 tech companies have already conducted mass layoffs in 2024, resulting in around 39,000 jobs lost. 

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Strategic shifts, macroeconomic difficulties and the race to artificial intelligence all continue to be major reasons behind these layoffs. 

Verdict’s roundup of the biggest tech layoffs made in 2023 can be found here.