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Aug. 10, 2022, 7:29 a.m. EDT

Nutanix plans to cut 4% of staff in what analyst sees as 'long overdue' move

Nutanix Inc. (NAS:NTNX) announced late Tuesday that it planned to cut about 4% of its workforce, or roughly 270 employees, "following a review of its business structure and after taking other cost-cutting measures to reduce expenses." Executives said in a filing with the Securities and Exchange Commission that the company was looking "to drive towards profitable growth." Nutanix executives expect to take a pre-tax charge of $20 million to $25 million in the October quarter related to severance and other "termination benefit costs." Piper Sandler analyst James Fish called the cuts "long overdue and a card that relatively new CEO [Rajiv] Ramaswami had in his back-pocket, as the prior management team had significantly overspent and never rationalized costs back." He deemed that the cost cuts are an "important step in helping the company be able to reaffirm the previous $300-$500M in FY25 FCF, which is a major investor thesis point." Shares of Nutanix have lost 48% so far this year as the S&P 500 (S&P:SPX) has dropped 14%.

Link to MarketWatch's Slice.