RPA software provider Automation Anywhere confirmed it is cutting staff amid the Covid-19 pandemic. The company did not disclose how many employees it would lay off, but an Axios report said more than 10 percent of its 2,600 employees could be affected. The company cited lower-than-expected growth and a massive acceleration in migration to cloud-based systems—both caused by the ongoing global health crisis.
“Due to the Covid-19 pandemic and the changes it has brought to the global economy, Automation Anywhere is adjusting operations and restructuring parts of the company, which will result in a workforce reduction,” the company said in a statement. “Although we are confident in the company’s strength and ability to grow going forward, given the current circumstances, we must reduce expenses in some areas and realign our resources to new skill sets in key growth areas, such as cloud and digital, that offer higher value service to customers.”
The pandemic has drastically shifted companies’ technology needs with many organizations moving to cloud-based services that can be accessed via the web by employees who now are working largely from home. While, the San Jose, Calif.-based company launched a “cloud-native” solution last October, much of its customer base uses software that is installed on local servers. In an open letter to Automation Anywhere employees, CEO Mihir Shukla acknowledged the change and that it forced the company to make cuts.
“This crisis of course plays an important role in our decision making,” he wrote in the letter he posted on the company’s LinkedIn page. “As we see the consequences of the pandemic unfold, we know many aspects of what we’ve considered ‘normal’ will never be normal again. Activities like large live events will not be possible for the rest of the year and probably longer. We are seeing a widening focus on business services delivery in the cloud. We see a new magnification of business continuity challenges, often best addressed by cloud solutions. Customers will require more agile business operating models to respond to future crises faster or to prevent them from occurring at all.”
In the letter Shukla predicted the company would still achieve double-digit growth in 2020, but it would not be as high as the company and its investors expected pre-pandemic. “To compensate for this,” he said, “we have modified our operating plan which calls for a reduction in our workforce.”
Automation Anywhere was founded in 2003. It has raised $840 million in four funding rounds from investors including SoftBank, Salesforce Ventures, Goldman Sachs, NEA, Workday Ventures, General Atlantic and World Innovation Lab.