Layoffs Hit Rackspace

by

Rumors have been swirling in private this week about large, looming layoffs at Rackspace — which shouldn't be all that surprising, considering investors late last year sold the pioneering San Antonio tech giant to Apollo Global Management, which has been described elsewhere as a "controversial vulture fund" with a history of saving companies the slash-and-burn way.

But now, as the Express-News points to Rackspace insiders anonymously confirming a workforce "trimming," Rackers targeted by the layoffs have themselves taken to social media to report on their own firing. One of them is Thomas Weeks, listed as a "technical community relations" specialist at the company's Blacksburg, Virginia office, who got the boot on Tuesday. The company's blog, for which Weeks occasionally wrote, calls him a "technical community evangelist" at Rackspace.

"So in case you hadn't heard, yes, Rackspace cut deep this week," Weeks wrote in a lengthy Facebook post (we've reached out to Weeks for further comment and haven't yet heard back). "Six percent across the board layoffs, but the figures were higher here at our remote Blacksburg office and many folks are saddened and looking to move on and put it behind them.. including me and my IT-Ops team."

According to Weeks' post, he's been a Racker since...well, the beginning. Before his firing, he says he was "employee #1," meaning he's likely been at the company longer than just about anybody else (Rackers get numbers to denote when they were hired). In his post, Weeks recounts those early years working out of the company's first data center in the Weston building downtown. "There's just too much to say and look back on to say how much Rackspace has meant to me over the years," he writes.

If Weeks' figure of a 6 percent across-the-board cut is accurate, that means hundreds of jobs could be impacted. Last year, when investors sold what was then San Antonio's largest publicly traded company to New York private equity firm Apollo Global Management, Rackspace had a global workforce of about 6,200 employees — 3,741 of them in San Antonio.

Rackspace spokesman Brandon Brunson wouldn't comment on the reports of company-wide layoffs on Tuesday, telling us via email, "We don't have anything to say on the matter at this time but we'll touch base with you when we have relevant information to share."


Update 4:00 pm: CEO Taylor Rhodes posted a blog to the company's website this afternoon confirming that Rackspace is cutting its U.S. workforce by about 6 percent. "Today is painful not only for those who are being laid off but also for the friends and colleagues they’re leaving behind," he wrote. "But our core values are intact and our culture brings us strength because we know our mission and purpose."

In his post, Rhodes says the company is cutting "mainly in areas where our workforce has grown more rapidly than our revenue." You can read more of his explanation for the layoffs here.


comment

Tags