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Cloud Software Group Layoffs Hit Citrix, Tibco; Does CEO’s Broadcom DNA Factor In?

CEO Tom Krause, whose background includes more than six years at Broadcom, known for cutting acquisitions bare, announced the layoffs on LinkedIn. He said Cloud Software Group has seen huge success in its first year, but that there's more progress to be made.

Kelly Teal

January 11, 2024

5 Min Read
Cloud Software Group layoffs
Eric Von Seggern/Shutterstock

One year after enacting similar cuts, a fresh wave of Cloud Software Group layoffs has arrived.

This week, the privately held company, which owns Citrix and Tibco, and business units related to those acquisitions, said it’s letting go of 12% of its staff.

A year ago, the firm axed 15% of its employee rolls. A Cloud Software Group spokesperson told Channel Futures on Thursday that the number of newly affected workers comes to “about 1,000, with an expectation that about 500 will return in an outsourced capacity.”

CEO Tom Krause, who announced the Cloud Software Group layoffs on LinkedIn, said that many of the cuts impact positions in operations, security and IT. However, he noted, underscoring what the spokesperson told us, “we are working with partners who will rehire many of those individuals to continue providing outsourced services to Cloud Software Group.”

The Cloud Software Group layoffs seem to bleed beyond the three domains Krause named, though. On TheLayoff.com, one poster wrote, “We’ve lost half a dozen in my team and we’re neither security, IT nor operations. This layoff seems to be widespread.”

In terms of regions, people in India, Ireland and the United States are reporting that they’ve lost their Cloud Software Group jobs.

Why More Cloud Software Group Layoffs Now?

Related:Cloud Software Group Layoffs Gut Citrix, Tibco, 'Useless' Management Remains

Krause buried the layoffs lead in his LinkedIn post, spending the first seven paragraphs touting Cloud Software Group’s success in its first full year.

“Our focus on adding value for our long-standing customers while driving a much higher level of business discipline and accountability is bearing fruit — with customer retention and financial results for our first fiscal year as Cloud Software Group coming in ahead of plan,” Krause wrote.

Now, he added, the company is “in a position to accelerate our … strategic initiatives while continuing to harden and streamline the corporate functions that support operating our great businesses.”

To that point, Krause and his team aim to turn Cloud Software Group into a “$20+ billion diversified software company.” 

Achieving that goal calls for simplified internal processes, programs, systems and operations, he said, along with better alignment of go-to-market functions and resources with the various business units’ strategies. And, Krause concluded before divulging news of the looming Cloud Software Group layoffs, the company needs to “focus our product roadmaps on investing in the innovation that best meets our customers’ needs.”

Cloud Software Group is owned by private equity firms, entities notorious for squeezing financials to the bone to reap profit. While the anticipated recession of 2023 did not materialize, inflation and interest rates remain high, as do many tech workers’ compensation packages.

Related:Citrix Joins Tibco in Newly Formed Cloud Software Group

CEO’s Broadcom DNA Part of Reason for Cloud Software Group Layoffs?

Perhaps the news of Cloud Software Group layoffs should not come as a surprise. Not only are companies such as Citrix and Tibco competing in a jam-packed space, but Krause’s business DNA includes more than six years at Broadcom. 

Broadcom, of course, is known for buying struggling vendors, then slicing and dicing them to operate as efficiently, and profitably, as possible. The ongoing drama as Broadcom dismantles VMware, including the Partner Connect Program, serves as the latest example.

Interestingly, Citrix stands out as one of the key competitors that could benefit from Broadcom’s elimination of various parts of VMware’s stack. Citrix’s virtualization software has long been viewed as an alternative to VMware. As Broadcom sheds pieces of VMware and eliminates the legacy vendor’s channel program, Citrix could be positioned to rescue many of the end users and partners spurned by VMware by Broadcom. 

To that point, wary partners could find some solace in Citrix. Last October, the vice president of Cloud Software Group’s Europe commercial and channel business said the company now abides by a channel-first strategy.

Related:HPE On Juniper Acquisition: Networking Now Core to Everything We Do

“[W]e can’t be everywhere all at once, but we can get to our partners and our partners can be everywhere all at once,” Aleksandra Lubavs told Channel Futures in the third quarter of 2023. “In our commercial business, we want to make sure that we’re driving the scale to the end customer. The best way to do that is through the partners who are there day in and day out.”

Tibco, meanwhile, competes against the likes of IBM, Oracle and SAP.

Cloud Software Group Layoffs Not Outliers; Employees React

Not even two weeks into the new year, job cuts are hitting the IT and telecom sectors, even as a wave of M&A engulfs the industry. So far, companies including Xerox, Orca Security, LiveVox and 8x8 have let go of employees.

On TheLayoff.com, affected Cloud Software Group staff let their views fly.

“Glad I am gone as of today,” wrote Sad but Happy, as one example. “In a final act of broken tools, Zoom would not work. Can't even fire me well.”

“This place has become a sh**show,” wrote a poster called Your Mom. “We beat our numbers, so let's get rid of the folks who support the product.”

“The ultimate losers are the customers,” said TempusFugit. “EBITDA maximization via elimination of development & product/customer support is a very successful short-term strategy, at least until folks catch on (hence the CSG elimination of mass customer-facing events.)”

Yet while most posters vented, one took a different view.

“Flat-out behaving like this is unfair only proves how good techies have had it in the last two decades,” Anonymous wrote. “And how blind they have been to some natural types of hardships you may just have taken for granted or never cared to stop and think about it. I'm just here to remind folks that this is life, a roller coaster, and to welcome them to the downside of the ride. Sit and commiserate with your fellow neighbors and friends. It's not so bad here. Let it humanize you. Let it saturate your soul and encompass you spiritually. You may not be able to afford the lifestyle you are used to. But cutting out all that distraction is just what society needs.”

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About the Author(s)

Kelly Teal

Contributing Editor, Channel Futures

Kelly Teal has more than 20 years’ experience as a journalist, editor and analyst, with longtime expertise in the indirect channel. She worked on the Channel Partners magazine staff for 11 years. Kelly now is principal of Kreativ Energy LLC.

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