NICE, the Israel-founded customer-service software company, is laying off about 500 employees globally, or 5 per cent of its workforce of 10,000. The move comes despite an earlier assurance from CEO Scott Russell that there would be no workforce reduction in Israel.
The layoffs are part of a broader effort to adapt to rapid changes brought about by artificial intelligence. Over the past two years, NICE has faced growing pressure as AI tools have transformed the customer-service industry, challenging its traditional software offerings.
To stay competitive, the company is making major strategic changes. It is looking to sell its financial-crime and compliance business, Actimize, while investing heavily in AI. One of its biggest moves is the acquisition of a German AI-agent startup for $1 billion. The technology is expected to help customers automate customer-service operations and reduce dependence on human call-centre agents.
The business transition comes at a difficult time. NICE’s stock has declined over the past year, and many customers have delayed large technology investments while assessing how AI will shape the market. Some large clients, including financial institutions, have reportedly postponed signing contracts until there is greater clarity on AI solutions.
Despite these challenges, NICE expects annual revenue to exceed $3 billion for the first time if it achieves its projected growth targets. However, earnings are expected to come under pressure.
For HR leaders, the development highlights a growing trend across industries: companies are investing in AI capabilities while redesigning workforce structures. As organisations accelerate automation and digital transformation, jobs are being reshaped, creating the need for workforce planning, reskilling and careful management of employee transitions.
According to NICE the restructuring is necessary to align resources with customer demand for large-scale AI-powered solutions and position the company for long-term growth.
