Alphabet’s Google (NASDAQ:GOOGL) (NASDAQ:GOOG) is reportedly making significant changes to its core U.S. ad sales division, which is expected to streamline decision-making and reduce bureaucracy as growth slows and competition from AI rivals heats up.
Google Streamlines GCS Leadership Structure
Google informed its U.S. employees in the Google Customer Solutions (GCS) division about the impending changes to the leadership structure, set to take effect in January, as reported by Business Insider on Wednesday.
One significant change will be the removal of “Managers of Managers” (MoMs) across several teams, according to a memo by John Nicoletti, Vice President of GCS. The memo did not mention any layoffs, stating that affected employees would transition into other roles, according to the report.
Advertising is a vital part of Google's business, and GCS — which serves midsize clients — is its primary driver.
Google did not immediately respond to Benzinga‘s request for comment.
Google Trims Managers, Bets On AI Growth
At an all-hands meeting in August, Google disclosed that it had cut the number of managers overseeing small teams by 35% over the past year. In February, Google implemented layoffs in its HR and cloud divisions to cut costs while boosting AI investments.
Despite these challenges, Bank of America Securities analyst Justin Post expects Google to post strong third-quarter revenue growth, as its ad momentum and AI push could power a big quarter. The analyst's findings show that advertising demand would exceed expectations. He added that a better macro environment, higher data usage, and companies redirecting budgets to offset declining organic search traffic would also contribute.
Tech Giants Intensify Restructuring
Similarly, other tech giants like Amazon (NASDAQ:AMZN) and Meta Platforms (NASDAQ:META) have also been implementing layoffs and restructuring to streamline operations and become more agile in the face of increasing competition and the need to accelerate progress in AI.
On Wednesday, Meta cut about 600 roles from its AI division to streamline operations, while Amazon reportedly plans to cut up to 15% of its HR staff.
Google holds a momentum rating of 87.23% and a quality rating of 84%, according to Benzinga's Proprietary Edge Rankings. Check the detailed report here.
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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
