SentinelOne, a Silicon Valley-based endpoint security company, has announced plans to cut approximately 105 jobs following a decline in data usage for its consumption-based pricing products, leading to lower-than-expected revenue.
The layoffs are part of an effort to achieve non-GAAP profitability next year amidst slower sales growth. CEO Tomer Weingarten stated that the company is transitioning from a full-on growth approach to a more balanced and disciplined growth strategy. The cost-cutting measures, which include reducing cloud hosting costs and prioritizing core products, are expected to save SentinelOne $40 million in the current fiscal year and $15 million in future years.
CFO David Bernhardt also mentioned that the company will incur severance costs and inventory write-offs as part of the restructuring.
Despite the challenges, Weingarten reassured investors that SentinelOne is committed to long-term growth and emphasized the company’s resilience and determination. The decline in data consumption was attributed to customers taking a more cautious approach in storing and analyzing data, filtering out unnecessary information.
Weingarten explained that customers are now more closely scrutinizing which log sources are most useful and making more prudent decisions on what data to store.
Additionally, the economic downturn has caused clients to defer purchasing decisions or renew at smaller sizes. However, the company remains optimistic about its future prospects in the cybersecurity industry, with plans to execute better and grow into a more sizable and profitable company.
