OpenText is laying off 1,200 employees while simultaneously creating 800 new positions to bolster its “growth and innovation plans.”
The company, which provides cybersecurity, AI, and IT management solutions, disclosed the details in a filing with the US Securities and Exchange Commission (SEC).
The restructuring to align its workforce more strategically will reduce the headcount by 1.7 percent.
It will bring the total number of employees to almost 23,000.
OpenText plans to reinvest around $50 million annually to create new roles in sales, professional services, and engineering.
This dual approach would yield annual cost savings of about $200 million for the $4.5 billion software giant.
An OpenText spokesperson said: “The Business Optimization Plan focuses on placing the right roles in global locations that are most appropriate for the business.”
The Ontario-based company aims to complete this restructuring in the first quarter of its Fiscal Year 2025.
OpenText expects to incur around $60 million in restructuring charges, largely recognized in the first quarter of Fiscal Year 2025.
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The company projects net savings of about $150 million once the plan is fully implemented.
“The Business Optimization Plan focuses on placing the right roles in global locations that are most appropriate for the business”
It plans to provide further details in its upcoming fourth-quarter and fiscal year-end results.
In the most recent quarter ending March 31, OpenText reported GAAP-based diluted earnings per share of 36 cents, an increase from 21 cents per share in the same quarter the previous year.
This rise was driven by a 16 percent rise in sales to $1.44 billion.
OpenText has expanded its information management software portfolio through various acquisitions, including Micro Focus, Zix, and Carbonite.
In May, the company acquired the Pillr managed detection and response platform from Novacoast, enhancing its threat hunting, monitoring, and response capabilities.
