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NVIDIA has avoided layoffs because they are the only truly lean mega-cap.
This approach has enabled NVIDIA to avoid needing layoffs to stay profitable. Unlike other Silicon Valley mega-caps, NVIDIA has avoided hiring into superfluous roles. CEO Jensen Huang has long seen NVIDIA as primarily a vehicle for research and development (R&D). This has allowed NVIDIA to become a mega-cap with only around 25K employees, while Google and Microsoft have 150K and 225K employees, respectively.
The absolute focus on R&D is in direct opposition to the manufacturing-oriented styles of Andy Grove at Intel and Lisa Su at AMD. Even businesses like Microsoft and Google can be thought of as ‘manufacturing’ software with a massive workforce. If an employee isn’t contributing to NVIDIA’s research growth, they won’t be hired.
Both the management and strategy of the business reflect this philosophy.
Every meeting is seen as a place for exploring the limits of NVIDIA’s engineering thinking. The doors are open to all levels of staff, and engineering problems are handled collaboratively. Where other technology businesses use throughput or revenue as key performance indicators (KPIs), the paramount KPI at NVIDIA is research breakthrough.
This has been an indomitable approach that has now led to NVIDIA building a wide moat with a powerfully leveraged lean team.
