'Dropboxers, today will be your last day': Dropbox lays off 9% of global workforce; CTO Ali Dasdan to step down. Read what the company said in memo

File-hosting service Dropbox is laying off approximately 9% of its global workforce, or about 200 employees. The cloud storage company estimates that the job cuts will cost between $27 million and $33 million, primarily in severance payments and related expenses. Dropbox expects to recognise most of these costs in the fourth quarter, with the remainder expected in 2027.

As of December 31, Dropbox had 2,113 full-time employees.

The company also announced that Chief Technology Officer Ali Dasdan will step down, effective November 18. CEO and co-founder Andrew Houston stepped down in May, with Ashraf Alkarmi promoted to succeed him. Separately, Dropbox said it expects its third-quarter results to be in line with or exceed its previous guidance for revenue and adjusted operating margin.

Dropbox layoffs: What the company said

Co-CEO Ashraf Alkarmi announced the layoffs in an email to employees, which the company has also posted on its blog. "Today, we’re making difficult choices about where we invest and how we organize Dropbox to achieve the product and growth priorities that will matter most for our long-term strategy. As part of these changes, we’ve made the decision to eliminate about 200 roles across Engineering, Product, Design, and G&A teams (approximately 9% of our global workforce). For most impacted Dropboxers, today will be their last day,” Alkarmi wrote.

He said the company's leadership team took responsibility for the decision and acknowledged the contributions of the affected employees.

“Our first priority today is to treat every person affected with the care and respect they deserve,” he said.

Why is Dropbox laying off employees?

Alkarmi said Dropbox remained profitable and had built momentum during the year. However, he said the company needed to concentrate its resources on areas with the greatest potential to drive customer impact and business growth.

The company's two-year strategy focuses on addressing more of its customers' critical workflows, reaching more target customers, including larger companies, and expanding its technology into new markets.

“Delivering on that strategy requires concentrating our resources on the priorities that will have the greatest potential for customer impact and growth,” Alkarmi wrote.

He added that the company would streamline teams and direct more support and resources towards product areas with the greatest potential to benefit customers and the business.

“In order to be successful, we can’t take the same work and spread it across fewer people,” he said.

Dropbox CTO Ali Dasdan to leave

Dropbox also announced that Chief Technology Officer Ali Dasdan would leave the company, with his last day scheduled for November 18.

Alkarmi said Dasdan had strengthened several technical capabilities that would be important to the company's next phase of transformation. Dasdan will focus on ensuring a smooth transition before his departure.

“I’m grateful for his leadership, his partnership, and the foundation he and the team have put in place,” Alkarmi wrote.

What severance benefits will affected Dropbox employees receive?

Dropbox said employees affected by the layoffs would receive severance and transition assistance.

The package includes 16 weeks of pay, plus an additional week for every completed year of service at the company. International employees will receive packages reflecting local practices and legal requirements.

Other benefits include fourth-quarter equity vesting and, for employees covered by the corporate bonus plan, a prorated lump-sum payment based on their 2026 bonus target.

The company also outlined additional support for affected employees:

• Immigration assistance: Support for employees holding work visas.
• Healthcare: Eligible US employees can receive a six-month COBRA subsidy if they elect the coverage.
• Mental health support: Access to Modern Health will continue through the end of the month in which employment ends, with extension options outlined in severance packages.
• Paid leave: Payment for eligible current and approved upcoming paid leaves, including medical and family leave.
• Devices: Employees can keep one Dropbox laptop, one assigned mobile device and their existing desktop peripherals.
• Career assistance: Job placement services and career coaching will be provided at no cost.

Alkarmi said the company's immediate priority was to support departing employees through the transition.

“To everyone leaving Dropbox: thank you. Your work to build our capabilities, serve our customers, and contribute to our culture has been deeply meaningful,” he wrote.