Kitchener-Waterloo-based OpenText, which offers information-management solutions for businesses, will be laying off 1,200 employees in what it calls a “business optimization plan.”
OpenText expects the layoffs to cost around $60 million.
CEO Mark Barrenechea announced the layoffs in a blog post on Wednesday as part of the launch of “OpenText 3.0,” a three-year strategic plan that describes how the company plans to reorient its business priorities.
The blog goes on to say that OpenText expects to reinvest savings from eliminating 1,200 removed roles into 800 new roles into the business’s sales, professional services, and engineering segments. It is unclear which business segments are facing layoffs.
“In further support of OpenText 3.0, today we announced a Business Optimization Plan focused on: (1) placing the right talent in the right locations of our business, (2) funding growth and innovations, and (3) completing these objectives with higher productivity, lower cost, and expanded margin,” the blog post reads.
OpenText expects the layoffs to cost approximately $60 million, while reducing the company’s annual expense by $150 million.
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Barrenechea described the company’s first decade as OpenText 1.0, focusing on content management for on-premises software, and the next decade as OpenText 2.0, for information management in the hybrid cloud. Barrenechea added that the upcoming 3.0 version of the company is “information reimagined” through cloud, security, and artificial intelligence.
OpenText has added leadership roles and reduced its debt in recent months. In April, the company announced it was appointing Todd Cione as its president of OpenText worldwide sales, as well as promoting Paul Duggan and Madhu Ranganathan to the roles of chief customer officer and chief financial officer, respectively.
The company also performed a $2-billion debt reduction in May after it completed the $2.275-billion divestment from its application modernization and connectivity (AMC) business to Waltham, Mass.-based Rocket Software. OpenText had acquired its AMC business, and laid off eight percent of its staff, as a result of its $5.8-billion acquisition of British SaaS company Micro Focus in January 2023.
Featured image courtesy Wikimedia Commons.
