Zoho pauses annual pay hikes, cuts marketing spend amid rising AI costs

🔗 원문 전체 보기 → Business Standard

요약

Homegrown technology firm Zoho Corporation has paused its annual pay hikes and pruned its marketing expenditure, citing sharply escalating Artificial Intelligence (AI) infrastructure costs and an uncertain outlook for the software sector, founder Sridhar Vemb…

본문

Zoho founder Sridhar Vembu cited a fourfold rise in server prices, higher AI usage costs and an uncertain software outlook

He said the company will work hard to avoid mass layoffs but "the outlook for software jobs in general is grim" (Photo: Reuters)

Listen to This Article

Homegrown technology firm Zoho Corporation has paused its annual pay hikes and pruned its marketing expenditure, citing sharply escalating Artificial Intelligence (AI) infrastructure costs and an uncertain outlook for the software sector, founder Sridhar Vembu said on Tuesday.

In a post on social media platform X, Vembu described the global employment landscape for the software sector as "grim" and said that the company has kept its headcount flat for the past 18 months while making efforts to avoid mass layoffs.

"The business outlook for software is uncertain, and AI has raised costs dramatically with a) A massive 4-fold increase in server prices which we need for data centres and b) AI usage increasing rapidly, leading to much higher expenses, which we are trying to control," Vembu said.

He added that a "challenging geopolitical backdrop" has further compounded these operational pressures.

Outlining the internal measures taken to navigate the headwinds, Vembu stated that the company has trimmed marketing outlays and communicated the wage freeze to its workforce.

Also Read

AI models may soon self-replicate without access to data centers: Anthropic

Houthis used Claude to develop missiles, test-fired rocket: Anthropic

Meta says new Muse model reaches AI frontier after aggressive push

New safeguards sharply reduce AI distillation attacks, says Anthropic

AI investment keeps global growth around 3%, with major Asia benefits: IMF

"We have cut down on our marketing budget. We have also told our employees that we cannot have our usual pay increase this year. I have apologised for not being able to avoid this," he said, adding that he was thankful to employees for understanding the situation.

He said the company will work hard to avoid mass layoffs but "the outlook for software jobs in general is grim".

"We are in the middle of reinventing ourselves. The next 3-5 years will decide how our reinvention has worked. Please pray for us," Vembu said.

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

More From This Section

Why 7-Eleven's India ambitions faltered despite Reliance Retail partnership

Old Monk sales ban costs Maharashtra govt ₹350 cr, company loses ₹500 cr

Kolte-Patil Developers Q2 sales bookings rise 52% to record ₹1,019 crore

Kalpataru Projects wins new orders worth ₹2,225 crore in T&D business

Non-metros emerge as key growth drivers for Amazon: V-P Saurabh Srivastavapremium

Buzzing :

Don't miss the most important news and views of the day. Get them on our Telegram channel

First Published: Oct 13 2026 | 12:22 PM IST