Yahoo Autos Read the memo Google CFO Ruth Porat sent to staff about new cost-cutting, including paring back worker perks
Google said it's paring some of its famous employee perks to save money and focus on AI investments.
CFO Ruth Porat said some office equipment will be replaced less frequently and cafe hours will be cut.
Read the memo obtained by Insider below.
Google is continuing its effort to cut back on spending in 2023. On Friday, CFO Ruth Porat announced to employees that Google would pare back some of its famous employee perks.
In a memo seen by Insider, Porat told staff that the company planned to close some office cafes during slow periods and shift around fitness classes and shuttle schedules. The company will also replace equipment it provides to employees, like new computers, less frequently.
Porat said the company's efforts to pare back expenses were "particularly vital because of our recent growth, the challenging economic environment, and our incredible investment opportunities to drive technology forward — particularly in AI."
The move comes a little more than two months after Google announced it would lay off 12,000 workers, citing slowing economic conditions.
The memo, obtained by Insider, was signed by a handful of group leaders, including Porat and Prabhakar Raghavan, Google's search lead. Google didn't comment.
Here's the memo in full:
Googlers,
This year, one of our important company OKRs is to deliver durable savings through improved velocity and efficiency. All PAs and Functions are working towards this. Googlers have asked for more detail so we're sharing more information below. This work is particularly vital because of our recent growth, the challenging economic environment, and our incredible investment opportunities to drive technology forward — particularly in AI.
We've been here before. Back in 2008, our expenses were growing faster than our revenue. We improved machine utilization, narrowed our real estate investments, tightened our belt on T&E budgets, cafes, MicroKitchens and mobile phone usage, and removed the hybrid vehicle subsidy. Since then, we've continued to rebalance based on data about how programs and services are being used.
How we're approaching this
The hardest decision we've had to make as a company is to reduce our workforce, and that is still being worked through in some countries. Most of the other large changes and savings won't be visible to most Googlers but will make a noticeable difference to our costs — think innovation in machine utilization for AI computing and reduced fragmentation of our tech stack. These are big, multi-year efforts. A few examples:
Changes to programs and services
We want to be upfront that there are also areas where we'll realize savings that will impact some services Googlers use at work and beyond.
We set a high bar for industry-leading perks, benefits and office amenities, and will continue that into the future. However, some programs need to evolve for how Google works today. As well as helping to bring down costs, these changes will reduce food waste and be better for the environment:
Just as we did in 2008, we'll be looking at data to identify other areas of spending that aren't as effective as they should be, or that don't scale at our size. We will let Googlers know of any other changes that directly impact services they use.
Our opportunities as a company are enormous. We have clear OKRs and substantial resources at our disposal to pursue them, but these resources are finite. Focusing on using them effectively makes a huge difference.
Jen, Philipp, Prabhakar, Ruth and Thomas (co-owners of the OKR), on behalf of all PA and Functional leads
Are you a current or former Google employee with a tip? You can reach Hugh via encrypted email (hlangley@protonmail.com) or encrypted messaging apps Signal/Telegram (+1 628-228-1836).
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