DigitalOcean Profits Up, More Stock Buybacks, but lays off 11% anyways | Hacker News Reader

DigitalOcean Profits Up, More Stock Buybacks, but lays off 11% anyways

twitter.com

41 pointsder-erlkonig21 comments

Lots of ESG hires who aren't doing shit other than organizing "events" and finding issues to complain about, this is dead weight.

Doesn't seem like that, most of these were engineers

https://www.crn.com/news/cloud/digitalocean-layoffs-engineer...

Doesn't seem that way. Most of these were engineers - https://www.crn.com/news/cloud/digitalocean-layoffs-engineer...

While the link does say that seven engineers were let go, it doesn't say how many other people were. There's no additional information, is this whole story about a mere seven people? It appears to be. So were only seven laid off? Doesn't say. Seems like CNN is leaving out some information.

Going to say the obvious, knowing nothing about this situation:

If the company is public, it has a fiduciary duty to it's shareholders to maximize profits, which means that management should act to reduce the workforce if they feel that portion returns less in profit than it costs to keep on board.

Private companies have more leeway, unless of course they have contractual obligations to uphold with private investors.

This happens in normal markets and helps to ensure companies continue to exist into the future and don't bleed out. Defunct companies can't employ anyone.

The legal standard is not to "maximize profits."

You are correct. I was wrong on the standard. They have a duty insofar as they know shareholders will replace them via voting power if they displease the majority of their shareholders, and generally shareholders want to increase value or dividends. However, that's not always the case. Shareholders could generally desire anything else. Thank you for the correction.

They're firing people cause of a meme, not cause anyone made a business case as you are implying.

A meme: that times are tough and firing people will free up capital.

It's a meme my boy. people are losing their jobs cause CEOs need to "make tough decisions".

They're not doing business evaluations. They're following the herd. A meme.

They are laying people off because now is the time to do it so people don't think twice about it. Best way to remove dead weight with little consequence.

Seems like the meme based leadership is working if they are bringing in record profits and conducting stocks Buybacks.

Feel free to remind me if they go into bankruptcy

Perhaps record corporate profits is not something society should optimize for if it accompanies large amounts of disruption in the lives of people.

When you've spent the past 30 years ensuring that your plate is always filled first by buying out the political class, of course you'll get record profits.

That don't stop your decisions from being arbitrary and just following the herd.

A bunch of emotionally stunted amature stoics who heard a ted talk about decimating legions have a go at it for themselves

This is an oft repeated misrepresentation. In the US, case-law shows there is a fiduciary duty to the corporation itself, not the shareholders. And there are no laws or regulations which require the maximization of profits.

Yes, I was wrong. This helped to clear it up. https://skeptics.stackexchange.com/questions/8146/are-u-s-co...

That said, voting shareholders could replace management if they deemed them to act differently than they think the next best candidate could. So there is some risk in deciding not to try and maximize the short or long (depending on voters) value of the company.

This helps to explain why the index giants like Vanguard are getting away with pushing their nonsense ESG on companies.

Why do people expect that profits and HR actions have so much to do with each other -- even with tons of evidence to the contrary?

This is dramatic even for Twitter

Is it though? Pretty understandable to be pissed off that all these companies are collecting record profits, doing layoffs, and then immediately buying back stock.

Something is fundamentally broken.

Paying workers you don't need and don't help your bottom line is fundamentally broken.

They aren't running a charity for jobs program.

Maybe the jerks that hired, and subsequently fired, those workers should be fired first?

A point as banal as it is unhelpful. Perhaps if companies didn’t act like charities during good times by promising workers lavish compensation and security, entangling in more workers than necessary, and then pulling the rug from under them during bad times, then this false expectation would have never arisen.

Reply on news.ycombinator.com