On July 11, 2016, the headline in a local business journal read, “Seagate soars as it boosts job-cutting plan fourfold, gives improved outlook.” Seagate Technology CEO Stephen Luczo announced that the company was planning to cut 6,500 jobs or about 14 percent of its workforce.
Fast forward to July 25, 2017, and we find an announcement in the same business journal that Seagate Technology CEO Stephen Luczo is stepping down as the company’s reported earnings significantly missed Wall Street expectations. As an aside, the company announced that it would cut 600 jobs. Luczo will be retaining his position as Seagate’s Chairman.
Luczo explained in the company’s press release, "It has been an honor and a privilege for me to have served as Seagate's CEO in 16 of the last 20 years. I am grateful to our amazing employees, customers, suppliers, and shareholders. I am excited about our future and I look forward to working with Dave in my new role as executive chairman at Seagate." In the same release, COO Dave Mosley who will replace Luczo as Seagate’s CEO, said, "I am honored to lead Seagate into the next era of leadership in the storage technology market and I am excited about the opportunities ahead for the Company. Seagate has a critical role in storing and securing the world's data and I am proud of our tremendous global employee organization that works every day to support that effort.”
The reason given for the reduction-in-force was, “drop in sales and profit on higher prices for memory chips, and fluctuations in demand for its products.”
People are losing their jobs as economic conditions change and executives seek to restore profitability and regain Wall Street’s favor by reducing personnel costs.