Dropbox to reduce workforce by approximately 20%

In an email to staff, CEO Drew Houston said, in part, “I’m writing to let you all know that after careful consideration, we’ve decided to reduce our global workforce by approximately 20% or 528 Dropbox (DBX)ers. As CEO, I take full responsibility for this decision and the circumstances that led to it, and I’m truly sorry to those impacted by this change…As we’ve shared over the last year, we’re in a transitional period as a company. Our FSS business has matured, and we’ve been working to build our next phase of growth with products like Dash. However, navigating this transition while maintaining our current structure and investment levels is no longer sustainable. We continue to see softening demand and macro headwinds in our core business. But external factors are only part of the story. We’ve heard from many of you that our organizational structure has become overly complex, with excess layers of management slowing us down. And while I’m proud of the progress we’ve made in the last couple years, in some parts of the business, we’re still not delivering at the level our customers deserve or performing in line with industry peers. So we’re making more significant cuts in areas where we’re over-invested or underperforming while designing a flatter, more efficient team structure overall…The changes we’re making today, while difficult, come at a pivotal moment when the market is accelerating precisely where we’ve placed our biggest bets. It’s been tremendously rewarding over the last few weeks to see customers and prospects light up when using Dash for Business for the first time, much like people did when we first launched Dropbox. And this time we’re starting from a position of strength. Millions of customers trust us as the home for their most important files, making the leap to organizing all their cloud content a natural evolution.”