Gitlab to lay off 7% of staff • Hacker News Board

Re: Gitlab to lay off 7% of staff

#321

Post by idontpost » Thu, Feb 09, 2023, 4:35 PM UTC

rkangel wrote: post #296

pwinnski wrote: post #287

Earlier quoted context omitted.

The only economic conditions that matter to any company is whether they will be able to continue earning money the way they have been. Since most of the companies doing 6-8% layoffs are concurrently reporting revenue growth, it isn't clear why they feel their future revenue is going to suddenly decline. It also isn't clear why, if they truly expect a decline, they'd continue to buy back shares or issue dividends. See…

> The only economic conditions that matter to any company is whether they will be able to continue earning money the way they have been. This is clearly not true, although it is probably the most important thing. Interest rates matter if a company financed expansion using debt. Cost of capital matters if your plan is to grow through VC and you're not yet profitable. Changes in these areas can change a company whose b…

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Re: Gitlab to lay off 7% of staff

#322

Post by hirako2000 » Thu, Feb 09, 2023, 4:37 PM UTC

charcircuit wrote: post #283

mplewis wrote: post #256

Earlier quoted context omitted.

The economy is not a human body.

It's an analogy

What is the relation between people's inability to notice having a brewing disease and business predicting turmoil in the future hence going for the diet?

Re: Gitlab to lay off 7% of staff

#323

Post by pwinnski » Thu, Feb 09, 2023, 4:37 PM UTC

rkangel wrote: post #296

pwinnski wrote: post #287

Earlier quoted context omitted.

The only economic conditions that matter to any company is whether they will be able to continue earning money the way they have been. Since most of the companies doing 6-8% layoffs are concurrently reporting revenue growth, it isn't clear why they feel their future revenue is going to suddenly decline. It also isn't clear why, if they truly expect a decline, they'd continue to buy back shares or issue dividends. See…

> The only economic conditions that matter to any company is whether they will be able to continue earning money the way they have been. This is clearly not true, although it is probably the most important thing. Interest rates matter if a company financed expansion using debt. Cost of capital matters if your plan is to grow through VC and you're not yet profitable. Changes in these areas can change a company whose b…

> Interest rates matter if a company financed expansion using debt.

I haven't personally seen companies taking out operating loans using adjustable rates. Have you? If rates are fixed, then a company's expansion plans may need to slow or stop, but that's not the same as the company contracting.

> Cost of capital matters if your plan is to grow through VC and you're not yet profitable.

Which does apply in Gitlab's case, I think, but does not apply in most of the cases we have been seeing of 6-8% layoffs made at profitable companies, many of which are concurrently doing expensive stock buybacks or issuing dividends.

If your business model depends entirely on 0% interest rates, then a 7% layoff is probably not enough, you have a dead company walking. But 6-8% is what's popular, so that's what we get.

Re: Gitlab to lay off 7% of staff

#324

Post by deburo » Thu, Feb 09, 2023, 4:38 PM UTC

pwinnski wrote: post #281

hn_throwaway_99 wrote: post #264

Earlier quoted context omitted.

This feels like another semantic argument, this time over what "macroeconomic environment is tough" means. You are correct in everything you say in your first paragraph. That said, it's fair to say that "sharply rising interest rates" are also part of the macroeconomic environment. You can say that it was silly for all these tech companies and investors to think the free money spigot would go on for so long, but the…

It isn't every big company. Apple hasn't, and they're the biggest of all. I think that is the point: it does not feel accurate to say that "macroeconomic conditions are tough" or that you expect slowdowns while recording record levels of revenue, and yet company after company after company is using these imaginary tough headwinds to justify laying off 6-8% of staff, often while paying dividends or issuing stock buy-b…

To me, complaining about the reasoning used by companies while not currently at the head of such a company feels pretty darn foolish. You just don't have the numbers at hands to qualify what they are saying.

And I don't understand why you would care about layoffs from the tech industry (of all people) anyway, it's one of the best industry today and will probably for a while still (forever?). Maybe one of those engineers can help his local tech shop instead.

Re: Gitlab to lay off 7% of staff

#325

Post by pokstad » Thu, Feb 09, 2023, 4:38 PM UTC

jlmorton wrote: post #190

> The current macroeconomic environment is tough No, it isn't, and it's embarrassing at this point to continue insisting this. The macroeconomic environment is good, particularly in the United States. Business investment is growing at 3% a quarter (annualized), which is better than the average over the past decade. Employment is growing rapidly. Inflation has been tame over the past six months. And wages are growing…

The use of the term “macroeconomic” has become so overused and cringe at this point to conceal the true complexity of what is going on.

Re: Gitlab to lay off 7% of staff

#326

Post by kortex » Thu, Feb 09, 2023, 4:38 PM UTC

jlmorton wrote: post #190

> The current macroeconomic environment is tough No, it isn't, and it's embarrassing at this point to continue insisting this. The macroeconomic environment is good, particularly in the United States. Business investment is growing at 3% a quarter (annualized), which is better than the average over the past decade. Employment is growing rapidly. Inflation has been tame over the past six months. And wages are growing…

It's typical paper-thin plausible deniability of corporations justifying actions.

- Oil supplies are tough so we are raising gas prices (we know we can get a few weeks/months of crazy profits and blame it on the energy crisis)

- Supply chain issues are tough so we have to tighten out belt (excuse to not give out raises/bonuses)

- The macroeconomic environment is tough, so we gotta lay off 7-10% (we have wanted to trim the fat for some time and now we have the perfect cover)

Funny how it is always slow to go the other way (slow for gas prices to come down, wages to rise, and rosters are expanded).

Re: Gitlab to lay off 7% of staff

#327

Post by ActionHank » Thu, Feb 09, 2023, 4:39 PM UTC

throway_gtlbr wrote: post #121

Laid off GitLabber here, the funny thing about this is the promotion season just ended. A LOT of people got promoted, so their employee cost is probably a wash after these promotions. Make of that what you will.

Would you mind sharing some rough details on the types of positions affected?

Really sorry to hear about the shitty situation you're going through, all the best in finding the next opportunity.

Re: Gitlab to lay off 7% of staff

#328

Post by danesparza » Thu, Feb 09, 2023, 4:39 PM UTC

gregors wrote: post #213

jlmorton wrote: post #190

> The current macroeconomic environment is tough No, it isn't, and it's embarrassing at this point to continue insisting this. The macroeconomic environment is good, particularly in the United States. Business investment is growing at 3% a quarter (annualized), which is better than the average over the past decade. Employment is growing rapidly. Inflation has been tame over the past six months. And wages are growing…

Disney is laying off 7k workers... >>> “While this is necessary to address the challenges we’re >>> facing today, I do not make this decision lightly,” said >>> CEO Bob Iger, " From the same article >>> ...the company released better than expected financial >>> results for the fourth quarter of 2022. Disney revenue in >>> the quarter rose 8% to $23.5 billion, edging past >>> estimates of $23.4 billion Truly they are…

It's part of a restructuring, and the cuts account for about 3% of their global workforce.

Re: Gitlab to lay off 7% of staff

#329

Post by idontpost » Thu, Feb 09, 2023, 4:40 PM UTC

prepend wrote: post #253

jlmorton wrote: post #190

> The current macroeconomic environment is tough No, it isn't, and it's embarrassing at this point to continue insisting this. The macroeconomic environment is good, particularly in the United States. Business investment is growing at 3% a quarter (annualized), which is better than the average over the past decade. Employment is growing rapidly. Inflation has been tame over the past six months. And wages are growing…

> Inflation has been tame over the past six months. No, I don’t think so. 6.5% [0] is still an absurdly high rate compared to the past 30 years. It is nowhere near tame and may still fluctuate quite a bit. [0] https://tradingeconomics.com/united-states/inflation-cpi

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Re: Gitlab to lay off 7% of staff

#330

Post by ericmcer » Thu, Feb 09, 2023, 4:40 PM UTC

Aperocky wrote: post #217

2-718-281-828 wrote: post #129

I'll have to find a new job in spring this year in IT after a one year break. I'm kind of worried considering all those lay offs I must say. I'm not a high profile candidate by any means.

I've always wondered if programming skill would be useful and transformative of traditional businesses internally (instead of a salesman pushing a B2B solution). But it's clear that traditional business have neither the know how or the money to hire software engineers in numbers that could actually affect such change. I wonder if downturns like this offers them a chance.

I have thought about this too, it would probably be very innovative if smallish 100 person companies brought on software people to do menial work with eventual automation in mind. The problem is no competent software engineer is going to work for 60k a year and no company is going to pay 200k.