Google Executives Face Employee Concerns Over Cost Cuts at Halloween-Themed All-Hands Meeting

Google employees pressure costumed execs at all-hands meeting for clarity on cost cuts

Alphabet CEO Sundar Pichai during the Google I/O developers conference in Mountain View, California, on May 10, 2023. Alphabet executives, donning Halloween costumes, faced questions from concerned employees at an all-hands meeting on Wednesday, following comments on the company's earnings call suggesting that more cost cuts are coming. "There is a reality to it," said Brian Ong, vice president of Google recruiting, according to a recording of the meeting reviewed by CNBC. "We are hiring less than we did a couple of years ago." Ong, who was specifically responding to a question about retention and promotion opportunities, added that fewer positions are open and geographic hiring has changed, "so you may see fewer roles available where you are." A Google spokesperson declined to comment. The meeting came after Alphabet reported better-than-expected third-quarter earnings and revenue Tuesday, sparking a rally in the stock. On a call with investors, CFO Anat Ashkenazi, who recently succeeded Ruth Porat, proclaimed she wanted to "push a little further" with cost savings across the company. Google's chief scientist, Jeff Dean, wore a starfish costume to the meeting, while Ashkenazi sported a jersey of former Indiana Pacers star Reggie Miller. CEO Sundar Pichai wore a black t-shirt that read "ERROR 404 COSTUME NOT FOUND" with an image of a pixelated dinosaur. Ashkenazi said one of her key priorities in the new role would be to make more cuts as Google expands its spending on artificial intelligence infrastructure in 2025. It's a theme that began in 2023, when the economy and market turned, and has continued since. Google has been restructuring its workforce to move more quickly in the AI arms race, where it faces increased competition. That's included layoffs, organizational shake-ups, and has led to workers feeling a "decline in morale," as CNBC previously reported. Over the last couple of months, Google has made cuts to its marketing, cloud and security teams in Silicon Valley, as well as in its trust and safety unit. Google is far from alone. Dropbox this week announced it will lay off 20% of its global workforce, while Amazon continues shuttering various projects. Within Google, employees have expressed concern that the company is preparing for more layoffs, possibly after the end of the year, according to internal correspondence viewed by CNBC.

Google employees pressure costumed execs at all-hands meeting for clarity on cost cuts

Google CEO Sundar Pichai in 2023.Boris Streubel / Getty Images for DFB Alphabet executives, donning Halloween costumes, faced questions from concerned employees at an all-hands meeting on Wednesday, following comments on the company's earnings call suggesting that more cost cuts are coming. "There is a reality to it," said Brian Ong, vice president of Google recruiting, according to a recording of the meeting reviewed by CNBC. "We are hiring less than we did a couple of years ago." Ong, who was specifically responding to a question about retention and promotion opportunities, added that fewer positions are open and geographic hiring has changed, "so you may see fewer roles available where you are." A Google spokesperson declined to comment. The meeting came after Alphabet reported better-than-expected third-quarter earnings and revenue Tuesday, sparking a rally in the stock. On a call with investors, CFO Anat Ashkenazi, who recently succeeded Ruth Porat, proclaimed she wanted to "push a little further" with cost savings across the company. Google's chief scientist, Jeff Dean, wore a starfish costume to the meeting, while Ashkenazi sported a jersey of former Indiana Pacers star Reggie Miller. CEO Sundar Pichai wore a black t-shirt that read "ERROR 404 COSTUME NOT FOUND" with an image of a pixelated dinosaur. Ashkenazi said one of her key priorities in the new role would be to make more cuts as Google expands its spending on artificial intelligence infrastructure in 2025. It's a theme that began in 2023, when the economy and market turned, and has continued since. Google has been restructuring its workforce to move more quickly in the AI arms race, where it faces increased competition. That's included layoffs, organizational shake-ups, and has led to workers feeling a "decline in morale," as CNBC previously reported. Over the last couple of months, Google has made cuts to its marketing, cloud and security teams in Silicon Valley, as well as in its trust and safety unit. Google is far from alone. Dropbox this week announced it will lay off 20% of its global workforce, while Amazon continues shuttering various projects. Within Google, employees have expressed concern that the company is preparing for more layoffs, possibly after the end of the year, according to internal correspondence viewed by CNBC. Pichai joked that the quarterly call was perfect preparation for Ashkenazi ahead of the company meeting. "I was telling Anat yesterday, earnings calls are a piece of cake compared to TGIF the next day," Pichai said, to laughs from attendees. Some employee comments and questions included praise for "another great quarter," success in chip advancements and improvements in Google's hit AI note-taking tool NotebookLM. However, other questions expressed fear of what greater cost efficiencies would mean for the workforce. "What exactly was meant by the comments on further efficiencies in headcount"? one question asked, pointing to Ashkenazi's comments from the call. Ashkenazi didn't share any more details but said employees are "one of the most important assets we have." She said that the company is investing in people and that it hired 1,000 new graduates in the third quarter. Pichai, who's been preaching efficiency for almost two years, chimed in to echo past sentiment. "If you have to do something new and it's going to take 10 people, if you can find a way to do it with eight people by making smart trade-offs somewhere and aligning teams better, that's an example of finding efficiencies in headcount as well," Pichai said. In response to another question about ongoing layoffs and reorganizations and what might be coming in the future, Pichai said, "If we are making companywide decisions, we'll definitely let you know." He said the company is spending heavily on AI at the moment, but the need to ramp up those expenses won't last forever. "We are going through an extraordinary period of capex advancement," Pichai said. "When you have these technology shifts, at the earlier stages, you invest disproportionately and then the curve gets better and that's the transition as an industry we are working through." He added that not all of the cuts are decided on by top executives. "It's not like all of these decisions are centrally done at a company level," he said. "And so, at the scale of our company, there could be moments where there are small groups of people impacted." Ashkenazi on Tuesday mentioned that one way to get more cost efficiency is by using AI internally. The company said 25% of new code is now generated by AI. In response to a question about productivity, Brian Saluzzo, head of "Core" developers, said that while the 25% refers to low-level tasks, leadership is in the midst of "expanding to more complex areas" within the company. "Core" refers to the teams that build the technical foundation underlying Google's flagship products. In May, CNBC reported that Google laid off more than 200 employees from its Core engineering teams, in a reorganization that included rehiring some roles in India and Mexico. Pichai followed up by saying, "In this transition moment, across all functions, everywhere in the company, it's worth challenging us to think where we can use AI to be more productive." He added that through 2025, the workforce should "strive to do more" and "help customers around the world take those learnings as well."

Anxious Google employees just broached cost-cutting concerns with executives -- who were dressed in Halloween costumes

Confronting company executives is already a daunting prospect. Asking them sticky questions while they're dressed in costume is downright spooky. But such was the case for Google employees who attended the tech giant's all-hands meeting Wednesday. Ahead of Halloween, Alphabet gathered employees to discuss company earnings posted late Tuesday. Revenue increased 15% to $88.27 billion, primarily due to Google's steep investments in AI that rocketed sales of its Cloud functions. Executives were dressed for the occasion, including CEO Sundar Pichai, who wore a a T-shirt reading, "ERROR 404 COSTUME NOT FOUND" accompanied by a pixelated dinosaur illustration; CFO Anat Ashkenazi, who wore the basketball jersey of retired Indiana Pacers star Reggie Miller; and chief scientist Jeff Dean, who was dressed as a starfish, CNBC reported. A Google spokesperson confirmed to Fortune that some execs were in costume during the regularly scheduled quarterly meeting, where they answered over 20 questions from employees ranging from products to cost cutting. Google said it's continuing to hire for priority roles. But the costumes appeared to do little to assuage the tension some employees felt following the earnings call, which alluded to impending cost cuts. Employees reportedly asked about retention and opportunities for promotion. "There is a reality to it," Brian Ong, vice president of Google recruiting, said in the meeting, according to a recording reviewed by CNBC. "We are hiring less than we did a couple of years ago." Ashkenazi, who replaced former CFO Ruth Porat, also hinted about cost cuts. Google has been successful in its cost-saving and efficiency-increasing measures, but "any organization can always push a little further," Ashkenazi said. The comments mirrored those of Pichai at the beginning of the year, when he warned that Google's "ambitious goals" also require job cuts. Google employees are familiar with the uncertain outcomes cost-saving strategies can take. Despite recent success for Google's Cloud, the unit also conducted sweeping layoffs in May, reportedly letting go of fewer than 100 employees. Google has 1,000 fewer employees this year compared to the same period last year, Fortune previously reported. Big tech is experiencing its slowest earnings growth in six quarters, and the industry hasn't been immune from mass layoffs, which have surpassed 130,000 cuts this year, including 3,765 across the sector in September, and 528 from DropBox alone announced earlier this week. Google's big AI investment push may continue to shake up headcount and team sizes, Pichai admitted, announcing during the earnings call that over 25% of Google code is now written by AI. But internal AI use is one way to increase workplace efficiency and cut back on costs, Ashkenazi argued. "Think not just about the size of the organization but mostly how we operate and how we run the business," Ashkenazi said during the earnings presentation. "I think when you simplify the organization...when we use AI within our own processes and how we get work done, there are some efficiencies or opportunities for efficiencies."

Google execs try to calm workers worried about jobs while wearing...

Google executives spooked employees at a creepy meeting this week -- wearing festive Halloween costumes as they fielded questions about further cost-cutting and layoffs, according to a report. During the all-hands meeting on Wednesday, Google's chief scientist, Jeff Dean, wore a starfish costume. CFO Anat Ashkenazi wore a sports jersey of former Indiana Pacers star Reggie Miller. As for CEO Sundar Pichai, the boss wore a t-shirt that read "ERROR 404 COSTUME NOT FOUND" with an image of a pixelated dinosaur. During the meeting with employees, a Google spokesperson told The Post that executives answered around 20 questions across a range of topics, including one or two questions concerning cost efficiency. A day earlier, Google parent Alphabet reported better-than-expected earnings and revenue, but on a call with investors, the recently hired Ashkenazi said she wanted to "push a little further" on cost savings. When asked whether layoffs might be coming in the future, Pichai said: "If we are making companywide decisions, we'll definitely let you know." "I was telling Anat yesterday, earnings calls are a piece of cake compared to [the meeting] the next day," Pichai joked during the employee meeting. Employees are worried that the company is preparing to slash more jobs after the end of the year, according to internal correspondence viewed by CNBC. "What exactly was meant by the comments on further efficiencies in headcount?" one employee asked during the meeting, referencing Ashkenazi's comments during the earning call. Ashkenazi did not share details, but said employees are "one of the most important assets we have." She said the company is investing in its workers, even hiring 1,000 new graduates in the third quarter. Pichai said there are ways to boost efficiency and restructure the company aside from layoffs. "If you have to do something new and it's going to take 10 people, if you can find a way to do it with eight people by making smart trade-offs somewhere and aligning teams better, that's an example of finding efficiencies in headcount as well," Pichai said. Google has been spending big on its artificial intelligence infrastructure to compete with other tech giants and AI startups like OpenAI, Anthropic and Elon Musk's xAI. The company has laid off workers -- trimming its marketing, cloud, security and safety teams -- to try to save on costs. "There is a reality to it," said Brian Ong, vice president of Google recruiting, according to a recording of the meeting reviewed by CNBC. "We are hiring less than we did a couple of years ago." Ong said fewer positions are open and geographic hiring has changed, "so you may see fewer roles available where you are." Though the company is splurging on its artificial intelligence units, Pichai said that push will not last forever. "We are going through an extraordinary period of capex advancement," Pichai said. "When you have these technology shifts, at the earlier stages, you invest disproportionately and then the curve gets better and that's the transition as an industry we are working through." However, he left the door open for further job cuts, saying not all decisions are made by the company's executives. "It's not like all of these decisions are centrally done at a company level," Pichai said. "And so, at the scale of our company, there could be moments where there are small groups of people impacted." During Tuesday's earnings call, Ashkenazi said using artificial intelligence internally could help the company trim down on expenses. Google has said that 25% of its new code is generated by AI. That 25% number refers to low-level tasks, but the company is working on "expanding to more complex areas," Brian Saluzzo, head of "Core" developers, said. The "Core" teams build the technology behind Google's products. In May, Google laid off more than 200 employees from its Core engineering teams and rehired some of those roles in India and Mexico.