Rackspace Technology said that will lay off ten percent of its staff and shift most of the work to offshore service centres.
More than 85 percent of these roles will go overseas
The announcement said that Rackspace “committed to an internal restructuring plan, which will drive a change in the types of and location of certain positions and is expected to result in the termination of approximately 10 per cent of the Company’s workforce”.
Affected employees have already been told and are expected to be leaving the company buildings with their personal possessions in old photocopy boxes over the next 12 months.
The restructuring means that the company will spend between $70 and $80 million (£50-58 million) over the next 12-24 months on “severance payments, healthcare benefits and other exit costs”.
Rackspace has decided that it was a good idea to focus on “expanding its internal training programme to further develop expertise in cloud services”, such as cloud, data, and cloud-native software engineering.
Commenting on the decision, Rackspace CEO Kevin Jones said that the initiatives will allow the company “to take full advantage of current market trends, drive significant earnings leverage as revenue continues to grow, and compete even more effectively with other cloud service providers”.
