Amdocs to Lay Off Hundreds in Global Restructuring to Focus on AI Strategy

Amdocs, an Israeli software and services company, is planning to lay off hundreds of employees globally as part of a strategic push toward artificial intelligence (AI). The company announced a new GenAI & Data division to integrate AI into its operations. The layoffs are the fourth major reduction in three years and reflect a broader trend in the technology sector, where firms like Microsoft and Intel have cut headcounts while expanding AI investments.

Amdocs, an Israeli software and services company, has announced the creation of a new GenAI & Data division and is preparing for a new wave of layoffs, affecting hundreds of employees globally. The move is part of the company's strategic push toward integrating artificial intelligence (AI) into its operations. This is the fourth major reduction in employee headcount in three years, reflecting a broader trend in the technology sector where firms are cutting headcounts while expanding AI investments.

Amdocs, which employs about 29,000 people worldwide, has been known to trim its workforce annually. In 2023, the company cut about 2,700 positions in two rounds, affecting 700 employees in Israel and 2,000 more globally. The latest layoffs are expected to be more significant, with the company preparing for a new wave of reductions [1].

The new GenAI & Data division, which has been in development for the past two years, aims to make AI an integral part of Amdocs' DNA. According to Ilan Sade, Senior Vice President and head of the new division, the goal is to integrate GenAI capabilities into every product, service, and process, driving new growth for the company and its customers. The division combines Amdocs' product, engineering, strategy, and go-to-market teams under one roof [1].

Amdocs is not the only company making similar moves. Microsoft, for example, declared that the notion "successful companies always hire more people" is outdated while laying off 9,000 employees during a peak performance period. Other companies, such as Verbit and Yotpo, have also shifted focus to AI and laid off employees to adapt to the changing market landscape [1].

The new division is driven by market demand, with examples such as an AI project in Macedonia that delivered leading billing, collection, and product catalog solutions, and the Telkom South Africa migration of 25 million subscribers to a cloud-based platform. Amdocs hopes to merge its existing capabilities with AI innovation to fuel its next stage of growth [1].

Amdocs' forward-looking statement highlights the risks associated with its AI and Generative AI integration, including the effects of general macroeconomic conditions, changes to trade policies, and rapid technological shifts. The company's ability to successfully implement AI and Generative AI in its offerings and operations is a key risk factor [2].

The new GenAI & Data division is part of a broader trend in the tech industry, where companies are investing heavily in AI while cutting headcounts. This trend is likely to continue as AI becomes more integrated into business operations, potentially leading to significant changes in the workforce.

References:
[1] https://www.calcalistech.com/ctechnews/article/legpd5dv7
[2] https://www.nasdaq.com/press-release/consumer-cellular-expands-strategic-collaboration-amdocs-accelerate-ai-driven-mvne