Google Cuts 35% of Managers, Offers Buyouts to 10 Departments

Google has cut 35% of managers who led small teams as part of its plan to become more efficient. The company has also offered voluntary buyouts in 10 departments, with 3-5% of employees accepting the offer. CEO Sundar Pichai said the buyouts were based on employee feedback and gave workers more control over their decisions. Analysts have a Moderate Buy consensus rating on GOOGL stock with an average price target of $217.25 per share.

Google has taken significant steps to streamline its operations and improve efficiency, as reported by CNBC [1]. The company has eliminated approximately 35% of its managers overseeing small teams, a move that aims to reduce bureaucracy and enhance overall organizational efficiency. This reduction was announced during a town hall meeting by Brian Welle, vice president of people analytics and performance, who emphasized the need for such changes to support the company's growth [1].

In addition to the managerial cuts, Google has implemented a "Voluntary Exit Program" (VEP) in 10 product areas, including search, marketing, hardware, and people operations. According to Fiona Cicconi, Google's chief people officer, between 3% and 5% of employees in these departments have accepted the buyout offers [1]. The VEP was designed to provide employees with an alternative to layoffs, allowing them to take control of their career decisions. CEO Sundar Pichai noted that the program was a response to employee feedback and has been successful in achieving its goals [1].

The stock market's response to these changes has been mixed. Analysts have a Moderate Buy consensus rating on GOOGL stock, with an average price target of $217.25 per share [1]. While the company's financial performance has been strong, with Alphabet's shares up 10% this year, the recent restructuring efforts have raised questions about the company's long-term strategy and the impact on employee morale [1].

Google's approach to efficiency and employee management has been the subject of debate, with some employees expressing concerns about the company's culture and job security. The company has not implemented a policy similar to Meta's "recharge" sabbatical, opting instead to rely on its existing vacation policies [1]. Despite these changes, Google remains committed to its goal of becoming more efficient and reducing costs, as indicated by the recent appointment of Alphabet finance chief Anat Ashkenazi, who has pushed for further cost cuts [1].

References:
[1] https://www.cnbc.com/2025/08/27/google-executive-says-company-has-cut-a-third-of-its-managers.html