Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Tell HN: DigitalOcean is doing layoffs

news.ycombinator.com

Post reply on HN
Print view View original

141–150 of 264 posts

Re: Tell HN: DigitalOcean is doing layoffs

#141

Post by jpgvm »

game_the0ry wrote: post #133
jpgvm wrote: post #121

I don't really get the motivation for this beyond personal greed on behalf of executives that are only seeking to prop up the share price in the short term. The market forces at work will force all technology companies down in valuation pretty much regardless, what is the difference of a few extra million market cap to handicap your ability to grow during the next expansion phase? I can understand it if you have brou…

> what is the difference of a few extra million market cap to handicap your ability to grow during the next expansion phase? For an executive, it's a big difference in stock based bonus. The executive level at corporate america tends to filter for status and financial obsessed sociopaths, so they make sociopathic decisions where they are content with making decisions that harm many (layoffs) but benefit themselves. T…

That would make sense if a significant amount of their compensation stood to be made during the contraction.

However if your tenure is expected to outlast the contraction then you would make more money in the long run by planning for how to be in the best position to exploit the market conditions during the next upswing.

It's hard to do that if you layoff crucial staff that are part of your growth engine.

Re: Tell HN: DigitalOcean is doing layoffs

#142

Post by reisse »

jpgvm wrote: post #121

I don't really get the motivation for this beyond personal greed on behalf of executives that are only seeking to prop up the share price in the short term. The market forces at work will force all technology companies down in valuation pretty much regardless, what is the difference of a few extra million market cap to handicap your ability to grow during the next expansion phase? I can understand it if you have brou…

> I can understand it if you have brought on a lot of fat and you want to lean out your team and need an excuse but outside of that rather narrow situation

This doesn't really seem to be a rather narrow situation. The tech companies were hiring like crazy for the past two years. Quick googling shows that DigitalOcean increased headcount by 31% last year.

And contrary to the popular opinion here, for me this does sound like the right move for the time. The logic, on the growing market, was "let's hire people now for 200k TC and give 50k raise after a year, because year later they'll be asking for 500k TC upfront". Now it's clear the salaries won't be going to the moon in the nearest future, so it makes sense to cut the fat.

Re: Tell HN: DigitalOcean is doing layoffs

#143

Post by Nadya »

activitypea wrote: post #114
Nadya wrote: post #68

Earlier quoted context omitted.

Never lose your 2FA backup codes or you're locked out of your account forever if you lose your 2FA device - despite support having a verification process to remove 2FA in the event you lost your codes - the support tickets are ignored or unmonitored. I was also a happy DO customer for the last 5 years or so. But now I'm locked out of my account. My fault for losing my codes (DO are the only backup codes I can't seem…

I had this happen in 2018 and had no trouble getting my account back. The support agent requested pictures of me with documents -- front of credit card used as payment method + passport -- and then disabled 2FA on my account.

The support ticket email requested I reply back with that information: Details about the payment method on the account, the date and amount of the last transaction by DO, a photo of a government-issued ID, and a photo of you holding the ID next to your face.

I provided the payment details, the date and amount of the last transaction as text, a screenshot of my bank statement of the transaction, 2 forms of ID (passport & driver's license), and a photo of my face next to both ID's on January 23rd. I replied again on February 7th with the most recent date of my transaction and the amount paid.

No response.

Re: Tell HN: DigitalOcean is doing layoffs

#144

Post by onlyrealcuzzo »

version_five wrote: post #84
onion2k wrote: post #79

Earlier quoted context omitted.

layoffs will continue until companies are much more efficient DO made a profit of a little over $250m in 2022, on revenue of $428.6m. That's a 60% margin. How much efficiency does a company need? EDIT: Correction.. those are the 2021 numbers. The latest numbers on the DO website for Q3 2022 state; " Gross profit of $97.6 million or 64% of revenue, an increase of 300 basis points year-over-year, and adjusted gross pro…

That doesn't address the point in the comment you replied to. He is talking about returns. The question is what return they made on invested capital. It might still be very good, I have no idea, but it's not the same as margin.

The value of future earnings vs current earnings is all that matters.

Nobody wants income. They want capital gains.

Corporate profits are a necessary evil in the way to extracting out lower-taxed capital gains.

When interest rates go up, the value of future profits goes down, and the value of current profits goes up.

This means, if you're the CEO of DigitalOcean, and all you care about is the stock price... You fire people so you have more current earnings so your stock price goes down less, so 1) your pay goes down less, and 2) your shareholders are happier.

That's pretty much it.

Re: Tell HN: DigitalOcean is doing layoffs

#146

Post by aCoreyJ »

Octoth0rpe wrote: post #38
JumpCrisscross wrote: post #20

Earlier quoted context omitted.

> FED wants unemployment to go up This is wrong. The Fed doesn’t want higher unemployment. It isn’t even willing to tolerate it. That’s the whole “soft landing” conversation, and why hikes are so hesitant. The ideal path would be labor market loosening with no more unemployment. Absent structural adjustments, that’s possible. But we need structural adjustments, so layoffs are necessary, which makes the closest to ide…

Maybe the reason why people keep repeating it is because that's more or less what Powell keeps saying: "Reducing inflation will likely require a sustained period of below-trend growth, and it will very likely require a softening of labor conditions," (source: https://www.cbsnews.com/news/federal-reserve-interest-rate-h... ) Softening of labor conditions is pretty directly saying "Increase unemployment". > and why cut…

There is a major difference between "this thing we have to do in order to hit our target 2% inflation rate may unfortunately increase unemployment" and "the fed wants layoffs"

Also job numbers have been incredibly good so it's not even generally true unemployment is increasing outside of sectors that are incredibly susceptible to fears of recession.

Re: Tell HN: DigitalOcean is doing layoffs

#147

Post by themgt »

onion2k wrote: post #79
monero-xmr wrote: post #8

When interest rates are 0%, any amount of growth compounded over years is attractive. When you can get a 5% risk-free return from treasuries, even 7% rate of return is unattractive when compared to the safest asset on earth returning 5%. My point is, layoffs will continue until companies are much more efficient, or interest rates go down.

layoffs will continue until companies are much more efficient DO made a profit of a little over $250m in 2022, on revenue of $428.6m. That's a 60% margin. How much efficiency does a company need? EDIT: Correction.. those are the 2021 numbers. The latest numbers on the DO website for Q3 2022 state; " Gross profit of $97.6 million or 64% of revenue, an increase of 300 basis points year-over-year, and adjusted gross pro…

You can check their latest numbers at Yahoo Finance: https://finance.yahoo.com/quote/DOCN/financials?p=DOCN

A 60% margin, wow, can't do much better than that! What's their P/E ratio? Oh ...

Re: Tell HN: DigitalOcean is doing layoffs

#148

Post by twoodfin »

contravariant wrote: post #83
MonkeyMalarky wrote: post #35

Earlier quoted context omitted.

Wild to think a country can have both too much employment and millions living below the poverty line.

Too much employment is a weird problem description to begin with. The more I think about it the weirder it gets.

Just imagine an absurdly overheated economy where a few million workers are doing something of really marginal or negative value, like cold calling seniors to sell them dogecoin. That’s not our economy today, but that’s ultimately what the Fed is looking out for, and it’s what you’d get if you have too loose money for too long.

Re: Tell HN: DigitalOcean is doing layoffs

#149

Post by eastbound »

jcadam wrote: post #116
halfpastten wrote: post #47

Word is that it's roughly ~10-11% of the company - am seeing a lot of (deactivated) in slack.

I'm still not sure if it's better to do it that way (one big cut) rather than multiple waves of smaller layoffs spread over time.

And call it stack ranking. Every six months you lose one person on your team.

Re: Tell HN: DigitalOcean is doing layoffs

#150

Post by fletchowns »

der-erlkonig wrote: post #48

Hearing that a lot of Community teams were let go, including the teams responsible for tutorials. Seems obvious DigitalOcean doesn't care about developers anymore. But this has been obvious for a while now. I guess their value "Our Community is bigger than just us" only matters when profits are up. Pour one out for DigitalOcean. It's the end of an era.

That is such a bummer to hear. The DigitalOcean tutorials are such an amazing resource.
Post reply on HN