‘Tone deaf’: US tech company responsible for global IT outage to cut jobs and use AI
The cybersecurity company that became a household name after causing a massive global IT outage last year has announced it will cut 5% of its workforce in part due to “AI efficiency”,In a note to staff earlier this week, released in stock market filings in the US, CrowdStrike’s chief executive, George Kurtz, announced that 500 positions, or 5% of its workforce, would be cut globally, citing AI efficiencies created in the business,“We’re operating in a market and technology inflection point, with AI reshaping every industry, accelerating threats, and evolving customer needs,” he said,Kurtz said AI “flattens our hiring curve, and helps us innovate from idea to product faster”, adding it “drives efficiencies across both the front and back office”,“AI is a force multiplier throughout the business,” he said.
Other reasons for the cuts included market demand for sustained growth and expanding the product offering,The company expects to incur up to US$53m in costs as a result of the job cuts,CrowdStrike reported in March revenue of US$1bn for the fourth financial quarter of 2025, up 25% on the same quarter in 2024, with a loss of US$92m,In July last year, CrowdStrike pushed out a faulty update to its software designed to detect cybersecurity threats that brought down 8,5m Windows systems worldwide.
The outage caused chaos at airports, and took down computers in hospitals, TV networks, payment systems and people’s personal computers.Aaron McEwan, vice-president of research and advisory at consultancy Gartner, said he was sceptical when companies announced AI efficiencies close to reduced revenue forecasts, as CrowdStrike had in March.“I think particularly in the tech sector … it’s a way of justifying a reduction in the workforce because [of] a financial issue,” he said.“So either they’re not tracking well financially, or they’re trying to send a message to investors that good times are around the corner.So I’m immediately sceptical.
”McEwan said companies were facing pressure to deliver on the big investments made in AI.“The productivity gains that we expect to see from AI just aren’t flowing through.”Gartner research showed across workforces less than 50% of employees are using AI in their job, and only 8% of employees are using AI tools to improve productivity.Toby Walsh, professor of artificial intelligence at the University of New South Wales, said CrowdStrike’s announcement was “pretty tone deaf” after the outage last year.“They would have been better redeploying this 5% of people to emergency response and bug fixing,” he said.
Walsh said the market should expect more of these announcements in future.“It’s pretty simple: more profits for companies, less work for workers.But we should learn from the first Industrial Revolution.If we stand up in solidarity, we can use these savings to improve quality and quantity of work for all.”Niusha Shafiabady, associate professor in computational intelligence at the Australian Catholic University, said AI job replacements were an “unavoidable reality”.
“No matter what we believe is moral and right, this change will happen.Unfortunately, a lot of people will lose their traditional jobs to AI and technology,” she said.“If [companies] see that they are saving money by using AI and technology and enhancing their services, they will ask their employees to leave.This is the reality.”A World Economic Forum report in 2023 found nearly 23% of all jobs globally will change in the next five years due to AI and other macroeconomic trends.
While 69m jobs are expected to be created, 83m jobs could be eliminated, leading to a net decrease of 2%, Shafiabady said.McEwan said companies – tech companies in particular – would be looking for ways to use AI to reduce workforces over time.“I have no doubt that there will be the emergence of companies that are able to reduce their workforce and substantially because of AI,” he said.“It’ll depend on the type of product that they’re selling.But at the moment most companies would be wise to look at how they can use AI to augment their workforce rather than replace.
”Has your job been lost to AI? Get in touch – josh.taylor@theguardian.com
Wikipedia challenging UK law it says exposes it to ‘manipulation and vandalism’
The charity that hosts Wikipedia is challenging the UK’s online safety legislation in the high court, saying some of its regulations would expose the site to “manipulation and vandalism”.In what could be the first judicial review related to the Online Safety Act, Wikimedia Foundation claims it is at risk of being subjected to the act’s toughest category 1 duties, which impose additional requirements on the biggest sites and apps.The foundation said if category 1 duties were imposed on it, the safety and privacy of Wikipedia’s army of volunteer editors would be undermined, its entries could be manipulated and vandalised, and resources would be diverted from protecting and improving the site.Announcing that it was seeking a judicial review of the categorisation regulations, the foundation’s lead counsel, Phil Bradley-Schmieg, said: “We are taking action now to protect Wikipedia’s volunteer users, as well as the global accessibility and integrity of free knowledge.”The foundation said it was not challenging the act as a whole, nor the existence of the requirements themselves, but the rules that decide how a category 1 platform is designated
Tech giants beat quarterly expectations as Trump’s tariffs hit the sector
Hello, and welcome to TechScape. I’m your host, Blake Montgomery, and this week in tech news: Trump’s tariffs hit tech companies that move physical goods more than their digital-only counterparts. Two stories about AI’s effect on the labor market paint a murky picture. Meta released a standalone AI app, a product it claims already has a billion users through enforced omnipresence. OpenAI dialed back an obsequious version of ChatGPT
Pro-Russian hackers claim to have targeted several UK websites
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Having an issue with your romantic relationship? Need to talk through something? Mark Zuckerberg has a solution for that: a chatbot. Meta’s chief executive believes everyone should have a therapist and if they don’t – artificial intelligence can do that job.“I personally have the belief that everyone should probably have a therapist,” he said last week. “It’s like someone they can just talk to throughout the day, or not necessarily throughout the day, but about whatever issues they’re worried about and for people who don’t have a person who’s a therapist, I think everyone will have an AI.”The Guardian spoke to mental health clinicians who expressed concern about AI’s emerging role as a digital therapist
Amazon makes ‘fundamental leap forward in robotics’ with device having sense of touch
Amazon said it has made a “fundamental leap forward in robotics” after developing a robot with a sense of touch that will be capable of grabbing about three-quarters of the items in its vast warehouses.Vulcan – which launches at the US firm’s “Delivering the Future” event in Dortmund, Germany, on Wednesday and is to be deployed around the world in the next few years – is designed to help humans sort items for storage and then prepare them for delivery as the latest in a suite of robots which have an ever-growing role in the online retailer’s extensive operation.Aaron Parness, Amazon’s director of robotics, described Vulcan as a “fundamental leap forward in robotics. It’s not just seeing the world, it’s feeling it, enabling capabilities that were impossible for Amazon robots until now.”The robots will be able to identify objects by touch using AI to work out what they can and can’t handle and figuring out how best to pick them up
‘The crux of all evil’: what happened to the first city that tried to ban smartphones for under-14s?
At 3.12pm on a sunny spring afternoon in St Albans, Yasser Afghen reaches for the iPhone in his jeans pocket, hoping to use the three minutes before his son emerges from his year 1 primary class to scroll through his emails. As he lifts the phone to his face, Matthew Tavender, the head teacher of Cunningham Hill school, strides across the playground towards him. Afghen smiles apologetically, puts his phone away, and spends the remaining waiting time listening to the birdsong in the trees behind the school yard.A one-storey 1960s block with 14 classrooms backing on to a playing field, Cunningham Hill primary feels like an unlikely hub for a revolution
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