HubSpot cuts nearly 660 jobs, about 7% of staff, in restructuring tied to AI strategy

The cuts were announced in a memo from chief executive Yamini Rangan and disclosed in a Form 8-K filed with the US Securities and Exchange Commission the same day. HubSpot said the plan will reduce management layers and organise product teams around customer outcomes rather than individual Hubs, creating what the filing calls a "flatter, faster organization." Most charges will be booked in the fourth quarter of fiscal 2026, and the eliminations should be substantially complete by the end of the first quarter of fiscal 2027.

The AI question

Rangan wrote that HubSpot has spent the past year shifting "from building software that helps customers grow to delivering outcomes for them with AI," a change she said is "transforming product, pricing and how we serve our customers."

She then drew a line between that strategy and the job cuts. "This is not driven by AI-related efficiencies," she wrote, adding that the reduction is "not simply a cost-cutting exercise." The Boston Globe reported that Rangan also said the AI pivot played a part in the restructuring, and both statements appear in the same memo. The 8-K itself does not mention AI; the AI language sits in the memo filed as an exhibit to it.

Rangan said every role was assessed against six criteria, including strategic need, layers and spans, and leadership, and that "the reduction was the outcome of that work, not the starting point."

Pay, benefits and the bill

HubSpot expects $65 million to $75 million in charges, mainly severance, notice periods, employee transition and benefits payments. Severance starts at 20 weeks of base pay plus one week for each year of service, capped at 30 weeks, with health benefits and six months of career-transition services.

US employees were notified on 6 October and receive five months of COBRA coverage as a lump sum; staff elsewhere get Modern Health benefits, with terms varying by local law. Departing employees may keep their HubSpot laptops and work-from-home equipment such as monitors and keyboards. Substantially all cash payments are expected by 30 June 2027.

A growing business cutting staff

The restructuring is not a response to a shrinking business. Second-quarter revenue rose 20% to $911.7 million, subscription revenue rose 20% to $894.0 million, and the customer count climbed 14% to more than 306,000. HubSpot forecasts about $3.7 billion in revenue for 2026, up about 18% from 2025.

It reaffirmed its third-quarter and full-year 2026 revenue and non-GAAP operating income guidance, said the charges would be excluded from non-GAAP results, and said it remains confident in longer-term margin targets set out at its Analyst Day on 17 September.

The company had 8,882 full-time employees at the end of 2025, 5,724 of them in the Americas, according to its latest annual report. A HubSpot spokesperson declined to tell the Boston Globe how many of the affected employees are based in Massachusetts. The last cut of this size came in January 2023, when the company eliminated about 500 jobs, also roughly 7% of staff at the time, citing a sharp slowdown in demand.

The stock

HubSpot closed at $217.09 on 6 October, down $3.52 or 1.6% from Monday's close of $220.61. The shares are down about 46% year to date, the Boston Globe reported. Simply Wall St puts the company's reported market capitalisation at about $11.0 billion.

Dublin and Irish law

HubSpot's European headquarters is in Dublin, and it employed about 1,000 people in Ireland by early 2023, more than a tenth of its workforce, according to IDA Ireland figures cited by The Next Web. The company has not said where the 660 cuts fall.

Irish law sets a floor for reductions of this size. At an employer with 300 or more staff, 30 redundancies proposed within 30 days count as a collective redundancy, and consultation must start 30 days before the first notice. Ignoring the rules is a criminal offence, with fines of up to EUR 250,000 on indictment. A 2025 EU directive revising the European Works Councils regime, due in national law by 1 January 2028, would require consultation early enough for a thorough assessment, with sanctions calculated against turnover.

The filing warns that the charges and their timing depend on assumptions and local consultation requirements, and that the plan may not deliver its intended benefits or could disrupt operations, customer relationships and employee retention.