The workforce at German software giant SAP have been informed that at least 8,000 jobs will be impacted by an ambitious restructuring plan.
As the software giant announced its fourth quarter and full year 2023 results, it also confirmed that a “planned transformation program including restructuring in 2024 reflects focus on scalability of operations and Business AI.”
It confirmed that it will restructure roles for 8,000 jobs, and spend 2 billion euros ($2.2 billion) on the programme that will see staff either retrained with AI skills, or replaced via voluntary redundancy programs.
This news sent SAP shares up 7 percent to an all-time high, according to reports.
But the firm also reportedly said that it expects to end 2024 with a headcount similar to current levels.
Most of the restructuring costs would be in the first half of the year, and contribute 500 million euros to operating profit in 2025 due to efficiency improvements, Reuters reported.
This restructuring comes after SAP in January 2023 already axed 3,000 jobs, or 2.5 percent of its global workforce.
The tech industry has been rocked by a swathe of job loss announcements in the past year from tech giants including Amazon, Google, and Microsoft, as they increase their focus on AI.
SAP has been experimenting with machine learning for a number of years now.
SAP now expects GenAI to fundamentally change its business and has pledged to invest more than $1 billion by backing AI-powered technology startups through its investment arm Sapphire Ventures, according to reports.