Thoughtworks provides update on restructuring activities

The company said, “On August 8, 2023, Thoughtworks initiated several measures to reduce operational costs and better align our business with our customers’ needs in a challenging macroeconomic environment. On May 7, 2024, we increased our restructuring program to capture additional cost savings. On August 2, 2024, the Company’s Board of Directors approved a second increase to its restructuring plan. During the second quarter of 2024, Thoughtworks incurred pre-tax cash charges of approximately $7.2 million, which include $6.2 million in wage-related costs and $1.0 million in non-wage related costs. Since the program’s inception in August 2023 through June 30, 2024, we have incurred pre-tax cash charges of approximately $28.3 million, which include $24.5 million in wage-related costs and $3.8 million in non-wage related costs, and have achieved $108 million of annualized savings. Thoughtworks is increasing its restructuring program to capture additional savings of $85 million to $95 million, for a total restructuring program savings of $185 million to $210 million. We now expect the restructuring program to be completed by October 31, 2024. Thoughtworks now expects to incur additional pre-tax cash charges of approximately $30.0 million to $35.0 million, for total expected pre-tax charges of approximately $56.5 million to $68.0 million (the “Updated 2024 Total Charges”). The Updated 2024 Total Charges include $51.0 million to $59.0 million in wage-related expenses, such as employee severance and related benefits, and $5.5 million to $9.0 million in non-wage related expenses, including costs related to reducing leased office space, vendor contract cancellations and professional fees. We anticipate our additional cost reduction efforts to impact approximately 6% to 7% of our headcount globally.”