Alphabet-owned Google has laid off more than 200 employees from its Core teams, just before releasing its first-quarter earnings report in view of a restructuring plan involving relocating certain roles to India and Mexico.
Records indicate that at least 50 engineering positions were terminated at Google's Sunnyvale, California offices. Internal documents obtained by CNBC suggest that many of these eliminated roles will be replaced with equivalent positions in Mexico and India within the Core teams.
The Core unit, crucial for developing Google's flagship products and ensuring user safety online, is at the centre of this reorganisation, as per Google’s website. They encompass essential technical units such as information technology, Python developer team, technical infrastructure, security foundation, app platforms, core developers, and various engineering roles.
The Core layoffs extend to the governance and protected data group, a critical area amid regulatory challenges confronting the company, especially as lawmakers worldwide intensify scrutiny on advancements in AI.
Last week, Asim Husain, Google's Vice President of Developer Ecosystem, during a town hall meet informed his team via email about the layoffs. He said this was the largest planned reduction for his team this year.
In an email, Husain wrote, "We intend to maintain our current global footprint while also expanding in high-growth global workforce locations so that we can operate closer to our partners and developer communities… announcements of this sort may leave many of you feeling uncertain or frustrated."
In mid-April, Google Chief Financial Officer Ruth Porat announced a restructuring of the company's finance department, involving layoffs and the relocation of positions to Bangalore and Mexico City.
Prabhakar Raghavan, the company's search chief, revealed in a March all-hands meeting plans to establish teams closer to users in key markets like India and Brazil, where labour costs are lower than in the US.
The changes coincide with Google experiencing its fastest growth rate since early 2022 and improving profit margins.
Alphabet reported a 15 per cent increase in first-quarter revenue compared to the previous year and unveiled its inaugural dividend alongside a $70 billion buyback plan last week, as per its latest report.
Since early last year, Alphabet has been cutting jobs, initially announcing plans to remove approximately 12,000 positions, equating to 6 per cent of its workforce, due to a decline in the online ad market.
Despite recent recovery in digital advertising, Alphabet has persisted with downsizing, implementing layoffs across various departments this year.
Pankaj Rohatgi, Google’s security engineering vice president, told his team in an email, "In order to optimize for our business goals, we are expanding work to other locations, which will result in some role eliminations and proposed role eliminations."
The European Union's Digital Markets Act, effective since March, seeks to curb anti-competitive behaviours in the tech industry.
Raghavan recently said that increased competition, tougher regulations, and slower natural growth are now the company's "new operating reality."
A spokesperson told CNBC that affected employees could apply for available positions within Google and access outplacement services.
"As we’ve said, we’re responsibly investing in our company’s biggest priorities and the significant opportunities ahead," the spokesperson replied in an email.
"A number of our teams made changes to become more efficient and work better, remove layers and align their resources to their biggest product priorities," the mail read.
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