Deepwatch Cuts Quarter of Workforce in AI Pivot as Cybersecurity Sector Faces Layoff Wave

Cybersecurity firm Deepwatch lays off dozens, citing move to "accelerate" AI investment | TechCrunch

Deepwatch, a cybersecurity firm that makes an AI-powered detection and response platform, laid off dozens of employees on Wednesday, citing AI as one of the reasons. John DiLullo, CEO at Deepwatch told TechCrunch in an email that the company "is aligning our organization to accelerate our significant investments in AI and automation." A current Deepwatch employee, who asked not to be named because they were not authorized to speak with the press, told TechCrunch that the layoffs affected between 60 and 80 staffers, out of a workforce of around 250 employees. A post on Linkedin by a person who said they were laid off mentioned 80 people as well. "They're doing something with AI and agentic AI but it sounds like bullshit," the current employee told TechCrunch. Eight former Deepwatch employees announced that they were laid off, according to LinkedIn posts seen by TechCrunch. Deepwatch is not the only cybersecurity company that has conducted layoffs this year. In May, cybersecurity giant Crowdstrike laid off around 500 workers, or 5% of its workforce. The cuts came despite a record year with "operating cash flow of $1.38 billion and record full year free cash flow of $1.07 billion," according to a press release at the time. Other cybersecurity companies that have cut their workforce this year are Deep Instinct, Otorio, ActiveFence, SkyBox Security, and Sophos.

Deepwatch layoffs deepen sector trend as firms reallocate to AI

CEO John DiLullo said the cuts reflect an effort to "accelerate significant investments in AI," affecting roughly a quarter of the firm's 250-person workforce. Deepwatch, a cybersecurity firm specializing in AI-powered detection and response, laid off dozens of employees on Wednesday, citing increased investment in AI as a primary reason. John DiLullo, Deepwatch CEO, informed TechCrunch via email that the company is "aligning our organization to accelerate our significant investments in AI and automation." A current Deepwatch employee, speaking anonymously due to authorization constraints, indicated to TechCrunch that between 60 and 80 staffers were affected. The company's workforce totals approximately 250 employees. A LinkedIn post by a laid-off individual corroborated the figure of 80 affected persons. The anonymous employee expressed skepticism, stating, "They're doing something with AI and agentic AI but it sounds like bullshit." Eight former Deepwatch employees have publicly announced their layoffs on LinkedIn, as observed by TechCrunch. Deepwatch is among several cybersecurity companies conducting layoffs this year. In May, CrowdStrike reduced its workforce by approximately 500 workers, representing 5% of its total staff. These reductions occurred despite CrowdStrike's reported "operating cash flow of $1.38 billion and record full year free cash flow of $1.07 billion," according to a press release issued at the time.