Walmart is cutting or relocating about 1,000 corporate workers in the latest white-collar shake-up to hit corporate America. The retail giant told staff on Tuesday that it was streamlining parts of its global technology and product teams after bosses found some employees were working on similar projects.
The move comes despite years of strong sales growth at Walmart, America's largest private employer with roughly 1.6 million US workers. While the bulk of Walmart's workforce is made up of hourly store employees, the latest cuts are aimed squarely at corporate staff as the company works to slim down its sprawling tech operations.
The restructuring arrives less than a year after Walmart hired former Instacart executive Daniel Danker to lead its global AI acceleration efforts. Danker is now working alongside Walmart's chief technology officer Suresh Kumar to streamline operations and improve team efficiency, according to the internal memo.
Executives also told affected employees they could apply for other open positions within the company, in line with Walmart's broader push to consolidate workers into major corporate hubs - particularly Bentonville, Arkansas. People familiar with the matter told the Wall Street Journal the memo specifically referenced relocations to Walmart's Bentonville headquarters or Northern California offices.
The latest cuts follow another round of layoffs earlier this year that affected about 100 workers at Walmart's corporate offices in Hoboken, New Jersey, according to a state layoff filing.
Walmart's strong recent growth has emboldened the company to ramp up investments in technology, automation and artificial intelligence. Executives said during an earnings presentation earlier this year that the retailer is increasingly focused on growing profits beyond traditional retail sales through businesses such as advertising while also reducing operating costs.
That push has led Walmart to merge global technology platforms across its warehouse chain Sam's Club and its international operations as it races to modernize its business. This race to catch up with the technological leaps the industry is making is not only apparent at Walmart, but other tech and manufacturing companies which have laid off thousands of workers in pursuit for AI investment.
At General Motors, thousands of workers were invited to a 15-minute virtual meeting where they heard the news they were being sacked. At the online meeting they were read a scripted message telling them they had been laid off. Then the meeting ended. While GM hasn't admitted these layoffs were related to AI advancements, a veteran programmer and data scientist who lost their job told CNBC that staff had been pushed to use AI more in their daily work before the cuts landed.
Cloudflare had employees meet a similar fate when over 1,000 were laid off following a memo from co-founders Matthew Prince and Michelle Zatlyn that warned staff that AI had completely transformed how the company operates, despite the company boasting about their impressive first-quarter revenue of $639.8 million.
Oracle, the software and cloud computing powerhouse founded by billionaire Larry Ellison, started cutting staff in April in what insiders described as a 'significant reduction in force.' Workers said they were informed via early morning emails before quickly losing access to company systems.
Leading powerhouse tech companies Amazon, Meta and Block have all announced job cuts while pointing in some way to AI, automation or efforts to make workers more productive.
A Walmart spokesperson told the Wall Street Journal the latest changes were tied to organizational restructuring and that the company was not planning to replace workers with AI. Although artificial intelligence was not directly mentioned in Walmart's Tuesday memo, the retail giant has increasingly focused on squeezing costs out of its sprawling operations through technology and automation.
'We believe this will result in our growth continuing to come at a much lower marginal cost than what it has historically,' John Furner said during the company's recent earnings presentation.
