Autodesk 2023 layoffs: What you need to know about the latest ADSK job cuts
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While FAANG stocks are mostly in the spotlight today due to earnings, Autodesk (NASDAQ:ADSK) carved out a place of its own on Friday. Shares of ADSK opened lower on the day and fell 3.1% to a session low after headlines reported further layoffs at Autodesk.
The company announced it would cut its workforce by 250 members, joining a long list of other companies to do so this year. Rivian (NASDAQ:SHORE) comes to mind recently, but many companies large and small have resorted to downsizing.
Autodesk said it is “focused on ensuring our resources remain well-aligned to support our top priorities for the year ahead.” He will also continue to hire for other key positions.
In November 2022, there were a record number of layoffs in the tech space. In January 2023, the sector broke this record, but the trend continues. And now Autodesk is part of this trend in technology.
Are Autodesk layoffs hurting ADSK stock?
ADSK shares have recovered some of today’s losses and are down just 1.5%. But the price action likely has more to do with the broader market than actual Autodesk layoffs.
For the most part, tech stocks were rewarded with job cuts. This indicates less expenses and higher margins. Moreover, investors are hoping that this is simply a “fat cutting” process and will not hurt productivity.
The reality is that while the global economy continues to do well, the tech space is struggling. Alphabet (NASDAQ:GOOGLNASDAQ:GOOG), Amazon (NASDAQ:AMZN) and Apple (NASDAQ:AAPL) all announced disappointing results Thursday night.
Then on Friday morning, investors received a much hotter than expected jobs report. This has fueled fears that the Federal Reserve will raise its interest rate outlook, which is negative for tech stocks.
Put it all together and the current selling pressure on ADSK shares is likely unrelated to the Autodesk layoffs. In fact, that equates to less than 2% of the company’s global workforce. Instead, it’s tied to the volatility we see in technology and it’s driven by FAANG.
It doesn’t help that in just over a week, ADSK stock has rebounded over 17%. It was not driven by earnings or any other material change. A simple surge of momentum in technology made it ripe for profit taking.
As of the date of publication, Bret Kenwell had (neither directly nor indirectly) any position in the securities mentioned in this article. The opinions expressed in this article are those of the author, subject to InvestorPlace.com publishing guidelines.