(Bloomberg) -- C3.ai Inc., a software maker that has worked to capitalize on interest in artificial intelligence, cut workers last week, citing employee performance and the need for cost savings.
Employees were fired across departments, according to people familiar with the matter. In a meeting Thursday with hundreds of workers, an executive said C3.ai needed to reduce costs, according to one attendee. Chief Executive Officer Tom Siebel, a well-known figure in the technology industry, founded the software company and took it public in 2020.
Managers framed the cuts as related to the performance of the individual workers rather than layoffs, and many of those fired received only one month of severance, according to the people, who asked not to be identified discussing internal company information. The scope of reductions couldn’t immediately be established. The company made similar cuts about six months ago and also labeled them performance-management, the people said. C3 had 914 employees at the end of April, according to a filing.
“C3 AI continues to hire and fill open positions to fuel our strategic areas,” a spokesperson said in a statement. “We currently have jobs posted for 109 open positions. Like many high-performance companies, we regularly manage out lower performance employees.”
Read More: C3.ai Criticized for Product Delays, Tom Siebel’s Micromanaging
The shares declined about 3.9% to $28.17 after earlier gaining as much as 8.2% before the news of the job cuts. C3’s stock had more than doubled this year to $29.31 as of Friday’s close, reflecting investors’ insatiable appetite for the emerging technology of artificial intelligence. The stock hit a high in June, but the enthusiasm cooled somewhat after former employees accused the company of exaggerating the performance of its technology, short-sellers released critical reports and profitability is taking longer than expected. Many other tech companies have cut employees this year in the search for better profit margins.
(Updates with share movement in the fifth paragraph.)
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