During an all-hands meeting on Wednesday, Google executives, including CEO Sundar Pichai and CFO Anat Ashkenazi, faced an array of questions from anxious employees in the wake of comments made during the company’s recent earnings call. The executives, who were dressed in Halloween costumes, were questioned about anticipated cost cuts after the earnings call suggested that additional reductions were on the horizon.
According to a recording of the meeting, Brian Ong, the vice president of Google recruiting, acknowledged that hiring had slowed significantly compared to previous years. He explained, “There is a reality to it,” indicating that the company is currently hiring fewer employees. In response to inquiries regarding retention and promotional opportunities, Ong noted a decrease in available positions and a shift in geographic hiring practices, which may lead to fewer job openings in various locations.
Despite reporting better-than-expected earnings and revenue for the third quarter, which initially led to a stock market rally, the overall mood among employees appeared tense. CFO Anat Ashkenazi, who succeeded Ruth Porat, emphasized during the earnings call her intention to implement more cost-saving measures across the company as Google ramps up investments in artificial intelligence infrastructure for 2025.
The Halloween-themed meeting included playful costumes, with Pichai wearing a black t-shirt emblazoned with “ERROR 404 COSTUME NOT FOUND” alongside a pixelated dinosaur, while Ashkenazi donned a jersey celebrating former NBA star Reggie Miller, and Chief Scientist Jeff Dean dressed as a starfish. However, amidst the lighthearted atmosphere, serious concerns lingered about the implications of ongoing cost-cutting efforts.
The atmosphere has been tense at Google, especially as employees have reported feeling a decline in morale amidst restructuring efforts. These changes began in earnest in 2023 when the company shifted its focus to streamline operations in the face of rising competition in the AI sector. Layoffs, organizational changes, and team consolidations have contributed to an unsettling environment, particularly as Google made cuts across its marketing, cloud, and security teams in Silicon Valley, as well as its trust and safety division.
Employees from various departments have voiced their anxieties regarding potential layoffs, speculating that the company may be preparing for more significant cuts after the year’s end. Pichai made light of the situation during the meeting, joking that the quarterly earnings call was easier to navigate than the upcoming all-hands meeting, which elicited laughter from attendees.
While some employees praised Google’s recent successes, particularly in advancements related to artificial intelligence, other questions focused on the potential ramifications of cost efficiencies on the workforce. One employee directly inquired about what was meant by “further efficiencies in headcount,” referring to comments made by Ashkenazi during the earnings call.
In her response, Ashkenazi did not elaborate further but reiterated that employees are among the company’s most important assets. She mentioned that Google hired 1,000 new graduates in the third quarter, emphasizing the company’s commitment to investing in its workforce despite ongoing restructuring efforts.
Pichai also reiterated the focus on efficiency, explaining, “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.” He promised transparency in communication regarding companywide decisions impacting the workforce.
As the company invests heavily in AI, Pichai highlighted that these expenditures may not last indefinitely. He stated, “We are going through an extraordinary period of capex advancement,” explaining that in the early stages of technology shifts, investment tends to be disproportionate. He reassured employees that not all decisions regarding cuts were made centrally, suggesting that smaller teams might be impacted rather than entire departments.
In another area of discussion, Ashkenazi pointed out that leveraging AI internally could lead to cost efficiencies. The company noted that 25% of new code is now generated by AI, with leadership looking to expand this approach to more complex areas within the company. In May, it was reported that Google had laid off more than 200 employees from its Core engineering teams during a reorganization that included rehiring some positions in different locations.
Pichai concluded by encouraging a culture of productivity and innovation across all functions, urging employees to explore how AI can enhance their work processes and benefit customers globally. As Google navigates these significant changes, the path forward remains uncertain, but the executives’ commitment to addressing employee concerns during the all-hands meeting reflects the challenges the company faces in balancing growth with operational efficiency.
