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Good morning, CFOs. Layoffs at PricewaterhouseCoopers; the state of the job market; plus, Tesla shareholders approve Elon Musk’s $1 trillion pay package.
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The firm’s reorganization of U.S. business services is about halfway complete. RICHARD B. LEVINE/ZUMA PRESS
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PricewaterhouseCoopers is making cuts, with more layoffs expected, Mark Maurer exclusively reports.
The firm is laying off about 150 employees in marketing, human resources, operations and other support functions, with more cuts expected, as it works to reorganize U.S. business services and ramp up use of AI and data.
The numbers: The affected employees, who represent 1.5% of the roughly 10,000 people in U.S. business services, were informed this week, said Tim Grady, PwC’s U.S. chief operating officer. Overall, PwC’s U.S. unit has about 75,000 workers.
Some context: The Big Four accounting firm in 2022 began evaluating how to make the teams that support the firm’s main service lines—audit, consulting and tax—more efficient. Business services covers areas such as marketing, human resources, IT, communications, legal and finance.
PwC last fall underwent its first formal set of U.S. layoffs since 2009, cutting about 1,800 people, or roughly 2.5% of the U.S. workforce. The cuts centered on advisory and products and technology operations. In May, the firm slashed about 1,500 additional jobs, primarily in audit and tax. PwC and other large accounting firms also focus on individual performance as the basis for some cuts.
Meanwhile, here’s the bigger picture: American employers are shedding tens of thousands of white-collar jobs as they further embrace AI. Some companies have decided not to replace certain roles in their finance, legal and customer-support functions. (Read on for more details here.)
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📆 Earnings
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Duke Energy
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Enbridge
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Franklin Resources
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KKR
📈 Economic Indicators
The University of Michigan releases its Consumer Sentiment survey for November.
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OpenAI CEO Sam Altman. FLORIAN GAERTNER/ZUMA PRESS
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Meanwhile, we have more coverage on OpenAI and additional comments from our interview with OpenAI Chief Financial Officer Sarah Friar from The Wall Street Journal’s Tech Live conference this week.
OpenAI CEO Sam Altman said the startup doesn’t want federal guarantees for its data centers or a bailout if it fails, laying out what he thinks the government’s role should be in America’s AI infrastructure build-out.
“If we screw up and can’t fix it, we should fail, and other companies will continue on doing good work and servicing customers,” Altman wrote in a lengthy X post.
Altman’s post came a day after Friar said at the Tech Live conference that the startup hoped financial institutions and perhaps the federal government would support its efforts by helping to guarantee chip financing. Depreciation rates of AI chips remain uncertain, she said, making it more expensive for companies to raise the debt needed to buy them.
“This is where we’re looking for an ecosystem of banks, private equity, maybe even governmental, the ways governments can come to bear,” she said. “The backstop, the guarantee that allows the financing to happen, that can really drop the cost of the financing but also increase the loan-to-value, so the amount of debt you can take on top of an equity portion.”
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What Else Matters to CFOs
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Through October, U.S. employers’ reported job cuts rose 65% from the same period last year, according to a new report. ALLISON JOYCE/BLOOMBERG NEWS
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On Thursday morning, a private consulting group said that employers announced a surge in October layoffs and more than a million job cuts so far this year—big numbers that seemed to raise fresh alarm about the state of the labor market.
A few hours later, Bank of America offered a slightly better picture: The job market continues to slow, but hadn’t changed substantially from an already rocky September.
“It’s cooling, but not collapsing,” said David Tinsley, senior economist at the Bank of America Institute, regarding the labor market.
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📰 Other headlines
📈 Earnings wrapup
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833,000
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Number of bikes that Peloton Interactive is recalling due to a faulty seat post that could break during use.
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Where senior finance leaders confront today’s expanding remit. Connect on capital, regulation, technology, and talent — and lead with clarity.
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Whirlpool, the Benton Harbor, Mich.-based appliance maker, named Roxanne Warner as CFO, effective Jan. 1. Warner, currently Whirlpool’s executive vice president of finance and controller, succeeds James Peters, who is stepping down from his current role at the end of the year after nine years, the company said. Peters will continue to serve as an executive vice president in a non-executive officer role with responsibility for leading enterprise transformation, according to Whirlpool.
Under Armour, the Baltimore-based apparel maker, has hired Reza Taleghani as its next executive vice president and chief financial officer, plucking the executive from luggage maker Samsonite. Taleghani will join the company in February, succeeding David Bergman, who has been the Baltimore company's finance chief since early 2017, Under Armour said. Bergman, who joined the company in 2004, will stay on through the first quarter of fiscal 2027. Taleghani has been Samsonite's executive vice president, CFO and treasurer since November 2018. Samsonite late Wednesday
said Taleghani would be leaving in January, and that it would launch a search for a new finance chief.
Bayer, the German agricultural giant, named Judith Hartmann as chief financial officer, effective June 1. She succeeds Wolfgang Nickl, who has been Bayer’s CFO since 2018, according to the company. Hartmann will join Bayer from private equity firm Sandbrook Capital, where she was an operating partner. Hartmann previously held the CFO role at French energy company Engie and at Bertelsmann.
—Colin Kellaher contributed to today’s Ledger.
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The Wall Street Journal's CFO Journal offers corporate leaders and professionals CFO analysis, advice and commentary to make informed decisions. We cover topics including corporate tax, accounting, regulation, capital markets, management and strategy. Follow us on X @WSJCFO. The WSJ CFO Journal Team comprises reporters Kristin Broughton, Mark Maurer and Jennifer Williams, and Bureau Chief Walden Siew. You can reach us by replying to any newsletter, or email Walden at walden.siew@wsj.com.
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